Question

Pass entries in the firm’s journal for the following on admission of a partner:
(i) Unrecorded Investments worth ₹ 20,000.
(ii) Unrecorded liability towards suppliers for ₹ 5,000.
(iii) An item of ₹ 1,600 included in Sundry Creditors is not likely to be claimed and hence should be written back.

Answer 1

Solution:

                                                Journal  

Sr. No.                  Particulars                           Debit Rs.       Credit Rs.

(i)                   Investment A/c          Dr.            20,000

                           To Revaluation A/c                                     20,000

            (Being investments recorded)

(ii)                  Revaluation A/c         Dr.             5,000

                        To Creditors A/c                                             5,000

            (Being liability recorded)

(iii)                    Creditors A/c            Dr.             1,600

                           To Revaluation A/c                                       1,600

               (Being liability decreased)