Question

Atharv and Anmol were partners in a firm sharing profits and losses in the ratio of 5 : 2. Their Balance Sheet as at 31st March, 2024 was as follows:

Balance Sheet of Atharv and Anmol as at 31^st March, 2024

Liabilities	Amount (₹)	Assets	Amount (₹)
Capitals:		Fixed Assets	14,00,000
Atharv	8,00,000	Stock	4,90,000
Anmol	4,00,000	Debtors	5,60,000
General Reserve	3,50,000	Cash	10,000
Creditors	9,10,000
Total	24,60,000	Total	24,60,000

Surya was admitted for \(\frac{2}{7}\) share in profits. Terms:
New ratio: Atharv, Anmol, Surya = 4 : 1 : 2
Fixed Assets decreased 10%
Stock sold ₹ 4,20,000
Surya brings ₹ 3,00,000 capital, ₹ 2,00,000 goodwill
Capital adjusted to Surya's capital Prepare Revaluation A/c and Capital A/cs.

Hint:

Adjust old partners’ capitals to match incoming partner’s share. Calculate revaluation gains/losses carefully.

Answer 1

Revaluation A/c:
Loss on Revaluation: ₹ 1,49,000 (due to decrease in fixed assets and undervalued stock)
Capital A/cs:
Revaluation loss shared based on the old ratio, and capital balances are adjusted to reflect Surya's new capital.