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in Reconstitution of a Partnership Firm – Admission of Partner by (27.3k points)
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Ann and Gopu were doing sole proprietorship business of same nature. Both are close friends. On 1st April 2005, they have decided to start a partnership business and have brought their existing assets into the new firm. They share profits in the ratio of 3:2. Details of existing assets and liabilities.

Ann Gopu
Building 1,00,000
Plant - 1,00,000
Furniture 60,000 40,000
Stock 80,000 1,00,000
Creditors 60,000 40,000

On 31st December, 2006, they have changed their profit sharing ratio and become equal partners. The assets were then revalued as follows:

  • Building is up by 10% 
  • Plant is down by 10% 
  • Furniture is up by 10% 
  • Stock is valued at 1,50,000 
  • Goodwill valued at Rs. 10,000

1. Give journal entries at to bring capital into the records on 01.04.2005. 

2. Prepare : 

  • Revaluation A/c 
  • Capital A/c

3. New Balance Sheet

1 Answer

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by (25.6k points)
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Best answer

Revaluation A/c

Capital A/c

New B/s

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