Question

A and B were partners sharing profits equally. Since A was devoting more time to the business it was agreed that profit sharing ratio will be changed to 2 : 1 from 1st April, 2026. Following balances have been extracted from their books on this date:                                                               ₹ Capitals: A                                      5,00,000                B                                      3,00,000 General Reserve                                90,000 Profit & Loss Account (Dr.)              30,000 It is agreed between the partners that: Goodwill should be valued at ₹ 1,20,000. Profit & Loss Account (Dr.) balance is to be carried forward. Furniture (Book Value ₹ 50,000) be reduced to ₹ 30,000. Computers (Book Value ₹ 1,00,000) be reduced by ₹ 60,000.

Based on the above information, choose the correct option:

Loss on Revaluation will be ______.

Options

• ₹ 90,000

• ₹ 60,000

• ₹ 80,000

• ₹ 70,000

Answer 1

Loss on Revaluation will be ₹ 80,000.

Explanation:

	₹
Loss on Revaluation of Furniture (50,000 − 30,000)	20,000
Loss on Revaluation of Computers	60,000
	80,000