Question

oh revaluation to A is 3750; B 2500 and C *250)
Q.No. 13. (Revaluation of Assets and Liabilities)
B, C and D are partners sharing profits and losses in the ratio of 3:2:1. Their Balance Sheet as on 31st December,
2015 was as follows:
Liabilities
Amount
Assets
Amount
Creditors
Reserves
Profit and Loss A/c (Profit)
Capital Accounts:
87,000 Cash
30,000
42,000 Debtors
62,000
21,000 Less: Provision for Doubtful Debts 2,000 60,000
Stock
1,80,000
Furniture
30,000
Plant
2,00,000
6,50,000 Building 3,00,000
8,00,000
8,00,000
B
3,00,000
C
3,00,000
was sie sich
50,000
The partners agreed that from 1st January, 2016 they will share profits and losses in the ratio of 4:4:1. They agreed
that
() Stock is to be valued at 20% less.
(ii) Provision for doubtful debts to be increased by 1,500.
(ii) Furniture is to be depreciated by 20% and Plant by 15%.
(iv) 23,500 are outstanding for salaries.
(V) Building is to be valued at 3,50,000.
(vi) Goodwill is valued at 45,000.
Partners do not want to record the altered values of assets and liabilities in the books and want to leave the reserves
and profits undistributed. They also decided not to show goodwill in the books.
You are required to pass a single journal entry to give effect to the above. Also prepare the revised Balance Sheet.
14th horo​

Answer 1

Answer:

ANSWER

(i) REVALUATION A/C

Dr. Cr.

Particulars Amount Particulars Amount

To Provision for Doubtful Debts 1700 By Prepaid advertisement Expenses 1200

To A's Capital

(revenue expense) 2100 By B's Capital

(personal expenses) 2000

By Loss transferred to:

- A's Capital a/c

- B's Capital a/c

- C's Capital a/c

300

200

100

3800 3800

(ii) PARTNER'S CAPITAL A/C

Dr. Cr.

Particulars A B C D Particulars A B C D

To Revaluation a/c

(personal) 2000 By Balance b/d 60000 40000 40000

To Revaluation a/c

(loss) 300 200 100 By Cash a/c 40000

To Balance c/d 61800 37800 39900 50000 By Creditors 10000

By revaluation expenses 2100

62100 40000 40000 50000 62100 40000 40000 50000

(iii) BALANCE SHEET

Dr. Cr.

Liabilities Amount Assets Amount

Capital a/cs:

- A

- B

- C

- D

61800

57800

39900

50000 Land and Building 50000

Bills Payable 10000 Plant and Machinery 40000

Creditors 30000

(-) D's Capital (10000) 20000 Furniture 30000

Stock 20000

Prepaid Advertisement

Expenses 1200

Debtors 30000

(-) Provision for (1700)

Doubtful debts

(+) Bills receivable 4000

dishonoured 32300

Bills receivable 20000

Bank (10000+40000-4000) 46000

239500 239500