Q7 please urgent 7.
AK, BK and CK were partners in a firm sharing profits in the ratio of 5:3:2. their Balance Sheet on 313.2014 was as follows:
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BK retired on the above date and AK and CK continued partnership by sharing profits and losses in the ratio of 3:2 Fohwing adjustments were to be made on the retirement of BK:
i) The Machinery was to be revalued at Rs 1,70,000
ii) The stock was to be reduced by Rs.2,000
iii) The furniture was to be reduced to Rs.3,200
iv) The provision for doubtful debts would be 6%
v) A provision of Rs.1,600 was to be made of outstanding expenses
v) A Liabiity on account of damages of Rs.14,000 included in creditors is settled at RS24,000.
​ The Partnership agreement provides that in case of retirement of a partner goodwil was to be valued at three years purchase of average profits, which are Rs.20,000. BK was paid in ful AK and CK were to deposit such an amount in bank so as to make their capital in proportionate to the new.' profit sharing ratio, subject to the condition that a bank balance of Rs 80,000 was to be maintained as working CapitaL Prepare Revaluation Account, Partners capital account and Balance Sheet.