Aryan and Adya were partners in a firm sharing profits and losses in the ratio of $\displaystyle 3$ : 1. Their Balance Sheet on 31st March, $\displaystyle 2024$ was as follows : Balance sheet of Aryan and Adya as at 31st March, $\displaystyle 2024$ Amount Amount Liabilities Assets (Q) (?) Capitals : machinery $\displaystyle 3,90,000$ Aryan $\displaystyle 3,20,000$ Furniture $\displaystyle 80,000$ Adya $\displaystyle 2,40,000$ $\displaystyle 5,60,000$ Debtors $\displaystyle 90,000$ Workmen's Less : provlslon for Compensation Reserve $\displaystyle 20,000$ doubtful debts $\displaystyle 1,000$ $\displaystyle 89,000$ Bank lean $\displaystyle 60,000$ Stock $\displaystyle 77,000$ Creditors $\displaystyle 48,000$ Cash $\displaystyle 32,000$ Profit & Loss Account $\displaystyle 20,000$ $\displaystyle 6,88,000$ $\displaystyle 6,88,000$ Dev was admitted into the firm on 1st April, $\displaystyle 2024$ for $\displaystyle 1$/5th share in the profits of the firm on the following terms : (i) Dev will bring capital proportionate to his share in the profits of the firm. (ii) Goodwill of the firm was valued at ₹ $\displaystyle 2,00,000$ and Dev will bring his share of goodwill premium in cash. (° iii) Machinery was revalued at ₹ $\displaystyle 4,50$,000. (° iv) A provision for doubtful debts was to be created at $\displaystyle 5$% on debtors. (v) A liability of ₹ $\displaystyle 3,500$ included in creditors was not likely to arise. Prepare Revaluation Account and Partners' Capital Accounts on Dev's admission.

OR

As fish, Vinit and Reema were partners sharing profits and losses in the ratio of $\displaystyle 2$ : $\displaystyle 2$ : 1. Their Balance Sheet on $\displaystyle 31$ March, $\displaystyle 2024$ was as follows : Balance sheet of Ashish, Vinit and Reema as at 31st March, $\displaystyle 2024$ Amount Amount Liabilities Assets (€) (?) Capitals : Patents $\displaystyle 80,000$ As fish $\displaystyle 2,00,000$ Furniture $\displaystyle 3,00,000$ Vinit $\displaystyle 2,00,000$ Stock $\displaystyle 1,70,000$ Reema $\displaystyle 1,00,000$ $\displaystyle 5$, $\displaystyle 00,000$ Debtors $\displaystyle 80,000$ General Reserve $\displaystyle 50,000$ Less : provision for Bills Payable $\displaystyle 80,000$ doubtful debts $\displaystyle 8,000$ $\displaystyle 72,000$ Creditors $\displaystyle 40,000$ Cash $\displaystyle 48,000$ $\displaystyle 6,70,000$ $\displaystyle 6,70,000$ On the above date, Vinit retired on the following terms : (i) Goodwill of the firm was valued at ₹ $\displaystyle 60,000$ and the same was adjusted into the capital accounts of As fish and Reema who will share profits in future in the ratio of $\displaystyle 3$ : 2. (ii) Value of stock was to be reduced by ₹ $\displaystyle 10$,000. (iii) Patents are found undervalued by $\displaystyle 20$% . (iv) Vinit was paid ₹ $\displaystyle 20,000$ immediately on retirement and the balance was transferred to his loan account carrying interest @ $\displaystyle 8$% p.a. Pass necessary journal entries on Vinit's retirement.

Books of Aryan and Adya Dr. Revaluation A/c Cr. Particulars Amount Particulars Amount (₹) (₹) To Provision for doubtful debts $\displaystyle 3,500$ By Machinery A/c $\displaystyle 60,000$ To Profit transferred to: By Creditors A/c $\displaystyle 3,500$ Aryan’s Capital A/c $\displaystyle 45,000$ Adya’s capital A/c. $\displaystyle 15,000$ $\displaystyle 60,000$ $\displaystyle 63,500$ $\displaystyle 63,500$ Dr. Partners’ Capital Accounts Cr. Particulars Aryan Adya Dev Particulars Aryan Adya Dev (₹) (₹) (₹) (₹) (₹) (₹) To Profit & Loss A/c $\displaystyle 15,000$ $\displaystyle 5,000$ By balance b/d ½ $\displaystyle 3,20,000$ $\displaystyle 2,40,000$ To balance c/d ½ $\displaystyle 3,95,000$ $\displaystyle 2,65,000$ $\displaystyle 1,65,000$ By Cash A/c $\displaystyle 1$ $\displaystyle 1,65,000$ By Premium for goodwill A/c ½ $\displaystyle 30,000$ $\displaystyle 10,000$ By Workmen Compensation $\displaystyle 15,000$ $\displaystyle 5,000$ Reserve ½ By Revaluation A/c ½ $\displaystyle 45,000$ $\displaystyle 15,000$ $\displaystyle 4,10,000$ $\displaystyle 2,70,000$ $\displaystyle 1,65,000$ $\displaystyle 4,10,000$ $\displaystyle 2,70,000$ $\displaystyle 1,65,000$ Q. (b) Ashish, Vinit and Reema were partners sharing… Ans. Books of Ashish, Vinit and Reema Journal Date Particulars L.F. Dr. Cr. Amount Amount (₹) (₹) Patents A/c Dr. $\displaystyle 20,000$ To Revaluation A/c $\displaystyle 20,000$ (Patents were found undervalued by $\displaystyle 20$%) Revaluation A/c Dr. $\displaystyle 10,000$ To Stock A/c $\displaystyle 10,000$ (Value of stock reduced) Revaluation A/c Dr. $\displaystyle 10,000$ To Ashish’s Capital A/c $\displaystyle 4,000$ To Vinit’s Capital A/c $\displaystyle 4,000$ To Reema’s Capital A/c $\displaystyle 2,000$ (Profit on revaluation credited to partners’ capital accounts) General Reserve A/c Dr. $\displaystyle 50,000$ To Ashish’s Capital A/c $\displaystyle 20,000$ To Vinit’s Capital A/c $\displaystyle 20,000$ To Reema’s Capital A/c $\displaystyle 10,000$ (General Reserve credited to partners’ capital accounts) Ashish’s Capital A/c Dr. $\displaystyle 12,000$ Reema’s Capital A/c Dr. $\displaystyle 12,000$ To Vinit’s Capital A/c $\displaystyle 24,000$ (Vinit’s share of goodwill adjusted in the capital accounts of Ashish and Reema in the gaining ratio) Vinit’s Capital A/c Dr. $\displaystyle 2,48,000$ To Cash A/c $\displaystyle 20,000$ To Vinit’s Loan A/c $\displaystyle 2,28,000$ (Vinit was paid ₹$\displaystyle 20,000$ on retirement, and the balance transferred to his loan account) .