Ganga, Yamuna are partners sharing profits and losses in 3:2 respectively. Their position on 31. 3. 2013.

Ganga, Yamuna are partners sharing profits and losses in 3:2 respectively.
Their position on 31. 3. 2013.  [10 Marks]
Balance sheet as on 31.03.2013

Liabilities
Amount
Assets
Amount
Capital A/c

Building
100000
Ganga
100000
Furniture
10000
Yamuna
75000
Stock
31000
Creditors
10000
Debtors  50000

Bills Payable
5000
Less: R.D.D.  -1000
49000
General Reserve
15000
Bank
15000





205000

205000

On 1st April, 2013, they admitted Saraswati on the following terms:

(1) Saraswati should bring in cash Rs. 1,00,000 as capital for 1/5 share in future profit and Rs. 25,000, as goodwill.

(2) Building should be revalued for Rs. 1,25,000.

(3) Depreciate Furniture at 12 1/2 % p.a. And stock at 10%.

(4) R.D.D. should be maintained as it is.

(5) The capital accounts of partners should be adjusted in their new profit sharing ratio through bank account.

Prepare: (1) Profit and loss adjustment account. (2) Capital Account. (3) Balance sheet of new firm.

Solution: In the books of the Ganga, Yamuna and Saraswati.

Profit and Loss Adjustment Account.


Particulars
Amount
Amount
Particulars
Amount
Amount
To Furniture A/c

1250
By Building A/c

25000
To Stock A/c

3100



To Profit on Revaluation Transferred to Partnes Capital A/c





Ganga’s Capital A/c
12390




Yamuna’s Capital A/c
8260
20650





25000


25000

Partners’ Capital A/c

Particulars
Ganga
Yamuna
Saraswati
Particulars
Ganga
Yamuna
Saraswati




By Balance b/d
100000
75000





By General Reserve A/c
9000
6000





By Bank A/c
-
-
100000




By Goodwill A/c
15000
10000
-




By P/L Adj. A/c
12390
8260
-
To Balance C/d
240000
160000
100000
By Bank A/c
103610
60740










240000
16000
100000

24000
16000
100000


Balance Sheet as on 1st April, 2013.

Liabilities
Amount
Amount
Assets
Amount
Amount
Capitals:


Building
100000

Ganga
240000

Add: Appreciation
25000
125000
Yamuna
160000

Furniture
10000

Saraswati
100000
500000
Less: Depreciation
1250
8750
Creditors

10000
Stock
31000

Bills Payable

5000
Less: Written off
3100
27900



Debtors
50000




Less: R.D.D.
1000
49000



Bank

304350








515000


515000