Question

Ajay, Vijay and Sanjay were partners sharing profits and losses in the ratio of 3 : 3 : 2. Their Balance Sheet as on 31st March 2020 is as follows:

Balance Sheet as on 31st March, 2020
Liabilities	Amount (₹)	Assets	Amount (₹)
Creditors	32,700	Bank	19,800
Reserve Fund	12,000	Stock	19,800
Capital Accounts:		Debtors	15,000
Ajay	33,000	Livestock	30,000
Vijay	45,000	Plant and Machinery	62,100
Sonjay	24,000
	1,46,700		1,46,700

On 1st April 2020 Sanjay retired from the firm on the following terms:

1. R.D.D. is to be maintained at 10% on debtors.
2. ₹ 300 to be written off from creditors.
3. Goodwill of the firm is to be valued at ₹ 12,000. however only Sanjay's share in it is to be raised in the books and written off immediately.
4. Assets to be revalued as: Stock ₹ 18,900, Plant and machinery ₹ 60,000, Live Stock ₹ 30,600.
5. The amount payable to Sanjay is to be transferred to his Loan account after retirement:

Prepare:

1. Revaluation Account
2. Partners' Capitol Account
3. Balance Sheet of the New firm.

Answer 1

Dr.	In the books of firm Revaluation Account			Cr.
Particulars	Amount (₹)	Particulars		Amount (₹)
To R.D.D. A/c	1,500	By Creditors A/c		300
To Stock A/c	900	By Live Stock A/c		600
To Plant and Machinery A/c	2,100	By Revaluation loss:
		Ajay capital A/c	1,350	3,600
		Vijay capital A/c	1,350
		Sanjay capital A/c	900
	4,500			4,500

 

Dr.	Partner's Capital Accounts						Cr.
Particulars	Ajay (₹)	Vijay (₹)	Sanjay (₹)	Particulars	Ajay (₹)	Vijay (₹)	Sanjay (₹)
To Goodwill A/c	1,500	1,500	-	By Balance b/d	33,000	45,000	24,000
To Revaluation A/c (Loss)	1,350	1,350	900	By Reserve Fund A/c	4,500	4,500	3,000
To Sanjay's Loan A/c	-	-	29,100	By Goodwill A/c	-	-	3,000
To Balance c/d	34,650	46,650	-
	37,500	49,500	30,000		37,500	49,500	30,000

 

Dr.	M/s Ajay and Vijay New Balance Sheet as on 1st April, 2020				Cr.
Liabilities		Amount (₹)	Assets		Amount (₹)
Capitals			Less: Written off	19,800	18,900
Ajay	34,650	81,300		900
Vijay	46,650		Debtors	15,000	13,500
Sanjay's Loan A/c		29,100	Less: R.D.D.	(1,500)
Creditors	32,700	32,400	Live Stock	30,000	30,600
Less: Written off	300		Add: Appreciation	600
			Machinery	62,100	60,000
			Less: Depreciation	(2,100)
			Bank		19,800
		1,42,800			1,42,800