Om, Ram and Shanti were partners in a firm sharing profits in the ratio of 3:2:1. On 1st April, 2014, their Balance Sheet was as follows:

On the above date Hunuman was admitted on the following terms:
(i) He will bring Rs 1,00,000 for his capital and will get 1/10th share in the profits.
(ii) He will brings necessary cash for his share of goodwill premium. The goodwill of the firm was valued at Rs 3,00,000.
(iii) A liability of Rs 18,000 will be created against bills receivable discounted.
(iv) The value of stock and furniture will bereduced by 20%
(v) The value of land and building will be increased by 10%
(vi) Capital Accounts of the partners will be adjusted on the basis of Hanuman's capital in their profit-sharing ratio by opening Current Accounts.
Prepare Revaluation Account and Partners' Capital Accounts.

Class 12 Accounts in Class 12 3 years ago

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Solution :
Working Note:
Calculation of Capital of PARTNERS in the NEW firm:
`{:((i)"TOTAL capital of the new firm on the basis of Hanuman's Capital"(Rs 1,00,000xx10//1),"Rs10,00,000"),("Less: Hanuman's Capital","Rs1,00,000"):}`
(II) Om's Capital `=Rs9,00,000xx3//6=Rs4,50,000,`
(iii) Ram's Capital `=Rs9,00,000xx2//6=Rs3,00,000,`
(iv) Shanti's Capital `=Rs9,00,000xx1//6=Rs1,50,000.`