| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
| Sundry Creditors | 25,000 | Cash/Bank | 5,000 |
| General Reserve | 18,000 | Sundry Debtors | 15,000 |
| Capital A/c : | Stock | 10,000 | |
| X – 75,000 | Investments | 8,000 | |
| Y – 62,000 | 1,37,000 | Printer | 5,000 |
| Fixed Assets | 1,37,000 | ||
| 1,80,000 | 1,80,000 |
They admit Z into partnership on the same date on the following terms:
(a) Z brings in Rs. 40,000 as his capital and he is given 1/4th share in profits.
(b) Z brings in Rs. 15,000 for goodwill, half of which is withdrawn by old partners.
(c) Investments are valued at Rs. 10,000. X takes over Investments at this value.
(d) Printer is to be reduced (depreciated) by 20% and Fixed Assets by 10%.
(e) An unrecorded stock of Stationery on 31st March, 2019 is Rs. 1,000.
(f) By bringing in or withdrawing cash, the Capitals of X and Y are to be made proportionate to that of Z on their profit-sharing basis.
Pass Journal entries, prepare Revaluation Account, Capital Accounts and new Balance Sheet of the firm.
SOLUTION
