Question

1,16,000 (Cr.).]
Chander and Damini were partners in a firm sharing profits & losses equally. On
31st March, 2017 their Balance Sheet was as follows:
Balance Sheet of Chander and Damini as on 31.3.2017
Amount
Assets
Amount
Liabilities
3
W
Sundry Creditors
Capitals :
Chander
Damini
1,04,000 Cash at Bank
Bills Receivable
2,50,000
Debtors
2,16,000 4,66,000 Furniture
Land and Building
5,70,000
30.000
45.000
75.000
1.10.000
3.10,000
5.70,000
On 1.4.2017, they admitted Elina as a new partner for 1/3rd share in the prof
on the following conditions :
(i) Elina will bring 3,00,000 as her capital and 50,000 as her share
goodwill premium, half of which will be withdrawn by Chander an
Damini.
(ii) Debtors to the extent of 5,000 were unrecorded.
(iii) Furniture will be reduced by 10% and 5% provision for bad and doubt
debts will be created on bills receivable and debtors.
(iv) Value of land and building will be appreciated by 20%.
(v) There being a claim against the firm for damages, a liability to the exte
of 8,000 will be created for the same.
Prepare Revaluation Account and Partners' Capital Accounts. (CBSE 201
Ans : Revaluation Profit * 41,750; Capital Balance : Chander 2,83,375 a
partners​

Answer 1

Prepare Revaluation Account and Partners' Capital Accounts

Explanation:

Partnership capital account is the account which contains all the transactions occurring between the partners and partnership firm like the initial contribution of capital in partnership, the interest of capital paid, drawings, the share of profit, and other adjustments and it is required in order to maintain proper accountability and transparency between the partners and the firm.

There are 2 types of Partner's Capital A/c:

• Fluctuating Capital Method- Only one account is prepared under this method i.e., Capital A/c
• Fixed Capital Method- two accounts are prepared under this method i.e., Capital & Current A/c