Question

X, Y and Z are partners sharing profits in the ratio of 3:2:1. They admit Mas a new partner. Following information is available on the Admission of M: Creditors 84,000 Machinery 66,000 Stock 30,000 Machinery was overvalued by 10% and creditors were found only Rs.81,000. Stock was also overvalued. Loss on Revaluation Debited to Z's Capital Account Rs.1,500. (a) 10% (b) 15% (c) 20% (d) 25%

PLEASE GIVE THE CORRECT EXPLANATION. NO SCAM KNOWLEDGE

Answer 1

Answer:25%

Explanation:

See guys to the machine is 6000(10/110 × 66000), by creditors is 3000. And z's loss is 1500. So total loss is 1500x6 which is 9000. So x's share of loss is 4500 and y's share of loss is 3000. So credit side total is 9000+3000 = 12000. And the debit side is 6000(machine). So the stock has to be 12000-6000 which is 6000. So the original stock balance should be 24000 but it is inflated by 6000 so the % overvalued is (6000/24000 *100) which is 25%. Answer's picture is attached.