Question

A and B are partners in a firm sharing profits and losses in the ratio of \(1:3\). C was admitted for \( \frac{1}{4} \)th share of profit. Machinery would be depreciated by \(20%\) (book value Rs.1,00,000) and building would be appreciated by \(10%\) (book value Rs.80,000), unrecorded debtors of Rs.2,000 would be brought in books. What was B's and C's share of revaluation?

• A. Rs.2,500, Rs.7,500
• B. Rs.7,500, Rs.2,500
• C. Rs.7,500, Rs.0
• D. Rs.0, Rs.7,500

Hint:

At the time of admission of a new partner: \[ \text{Revaluation Profit/Loss} \] is shared only by the old partners in their old profit-sharing ratio.

Answer 1

The Correct Option is C