Following is the Balance Sheet of A and B, who had been sharing profits in proportion of 3/4th an
Channel: Doubtnut
Date: 2020-03-29

Following is the Balance Sheet of A and B, who had been sharing profits in proportion of 3/4th and 1/4th as at 31st March, 2019: They admit C into partnership on 1st April, 2019 on the following terms: (i) C pays RS.14,000 as his capital for 1/5th share in the future profits. (ii) Goodwill is valued at RS.20,000. C is unable to bring cash for his share of goodwill. (iii) Stock and Furniture be reduced by 10% and 5% Provision for Doubtful Debts be created on Debtors. (iv) Land and Building be appreciated by 20%. (v) Capital Accounts of the partreciated be readjusted on the basis of their profito-sharing arrangement and any excess or deficiency is to be transferre to their Currnet Accounts. Prepare Revaluation Account, Partners\' Capital Accounts and the Balance Sheet of the new firm.