The Balance Sheet of X,Y and Z who share profits and losses in the ratio of 3 : 2 : 1, as on 1st
Channel: Doubtnut
Date: 2020-03-29

The Balance Sheet of X,Y and Z who share profits and losses in the ratio of 3 : 2 : 1, as on 1st April, 2019 is as follows: On the above date, W is admitted as a partner on the following terms: (a) W will bringRs 50,000 as his capital and get 1/6th share in the profits. (b) He will bring necessary amount for his share of goodwill premium. Goodwill of the firm is valued atRs 90,000. (c) New profit-sharing ratio will be 2:2:1:1. (d) A liability ofRs 7,004 will be created against bills receivable discounted earlier but now dishonoured. (e) The value of stock, furniture and investments is reduced by 20%, whereas the value of Land and Building and Plant and Machinery will be appreciated by 20% and 10% respectively. (f) Capital Accounts of the partners will be adjusted on the basis of W\'s Capital through their Current Accounts. Prepare Revaluation Account, Partners\' Accounts and Capital Accounts.