Suresh and Ramesh are partners in a business sharing profits and losses in the ration of 2:3. Balance sheet as on 31st March, 2013 is as follows:
Balance Sheet as on 31 March, 2013
They admitted Kailash on 1st April, 2013 as a partner on the following terms:
1) Kailash will bring Rs 30,000 as his capital for 1/4th share in future profit and Rs 12,000 as goodwill which will be withdrawn by old partners.
2) Stock and Machinery to be depreciated by 10%.
3) R.D.D. is to be maintained at 5% on debtors.
4) Building to be appreciated by 20% and furniture is revalued at Rs 10,000.
Prepare Profit and Loss Adjustment Account, Partner’s Capital Accounts and Balance Sheet of the New firm.
