Page 73 - ISCDEBK-12

Admission of a Partner 3.31

4. Gain (Profit) on Revaluation—` 30,000; Capital Balances: A—` 1,65,000; B—` 1,40,000; C—` 1,15,000;
D—` 1,20,000; Total of Balance Sheet—` 5,67,200.
[Hint: Change in profit-sharing ratio will result in loss of 6/24th to A and 2/24th to B; gain of 2/24th to
C and 1/4th to D. Hence, the entry for adjustment of goodwill premium will be:
` `
C ’s Capital A/c ...Dr. 10,000
Premium for Goodwill A/c ...Dr. 30,000
To A’s Capital A/c 30,000
To B ’s Capital A/c 10,000.]

5. Gain (Profit) on Revaluation—` 6,300; Capital Accounts of Jain—` 85,600; Gupta—` 71,700 and Mishra—
` 52,433; Total of Balance Sheet—` 2,49,733.

[Hint: Calculation of Mishra’s Capital: Combined Capital of Jain and Gupta (after adjustments) for 3/4th
share = ` 85,600 + ` 71,700 = ` 1,57,300
New Firm’s Total Capital = ` 1,57,300 × 4/3

Mishra’s Capital for 1/4th share = ` 1,57,300 × 4/3 × 1/4 = ` 52,433.]
6. Gain (Profit) on Revaluation—` 9,600; Capital A/cs: A—` 61,750; B—` 31,650; C—` 23,350; Total of Balance
Sheet—` 1,46,050.
[Hint: Capitals of A and B after all adjustments are ` 61,750 and ` 31,650 respectively. Hence, the combined
capital of A and B is equal to ` 93,400 which is 4/5(1 – 1/5) of the capital of the firm.
Hence, C’s 1/5th share in the capital will be: ` 93,400 × 5/4 × 1/5 = ` 23,350.]
7. Revaluation Loss—` 15,000; Capital Accounts (31.3.2020): Hari—` 67,500; Ram—` 60,000; Suraj—` 25,500;
Balance Sheet Total—` 2,55,000.