Vinod, Mohan and Sohan are partners in a firm sharing profits and losses in the ratio of 3:2:1. Their Balance Sheet as at 31st December, 2014
Capitals : Vinod
|Cash in hand
Less : provision 3,000
Mohan retired on 1st January ,2015 on the following terms:
(i) Provision for doubtful debts will be raised by Rs. 1,000.
(ii) Stock will be depreciated by 10% and furniture by 5%.
(iii) There is an outstanding claim for damages of Rs. 1,100 and it is to be provided for in the books.
(iv) Creditors will be written back by Rs. 6,000.
(v) Goodwill of the firm is valued at Rs. 22,000, which is not to be shown in the books of new firm.
(vi) Mohan is paid in full with the cash brought in by Vinod and Sohan in such a manner that their capitals are in proportion to their profit sharing ratio of 3:2
Prepare Revaluation Account , Partners Capital Account and B/S of the new firm.