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Chapter 5 Admission of a Partner 5.41
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14. Following is the Balance Sheet as at 31st March, 2018 of Sushil and Satish who are in partnership sharing
profits and losses in the ratio of 3 : 2:
Liabilities ` Assets `
Capital A/cs: Freehold Premises 10,000
Sushil 25,000 Machinery 5,400
Satish 9,000 34,000 Stock 12,500
Creditors 18,400 Debtors 22,500
Less: Provision for Doubtful Debts 4,000 18,500
Cash at Bank 6,000
52,400 52,400

They admit Samir into partnership with effect from 1st April, 2018 on the following conditions:
(a) Samir to bring in ` 6,000 as capital and ` 4,800 for 2/7th share of goodwill, both the sums remaining
in the business.
(b) Freehold premises have been revalued at ` 15,000; Stock to be discounted @ 10% and Provision for
Doubtful Debts to be reduced by ` 1,000.
Pass Journal entries in the books of the firm to record the transactions relating to Samir’s admission and
prepare Balance Sheet of Sushil, Satish and Samir as at 1st April, 2018.
[Ans.: Gain (Profit) on Revaluation—` 4,750; Balance Sheet Total—` 67,950.]

15. X, Y and Z were partners in a firm sharing profits and losses in the ratio of 3 : 2 : 1. Following is their
Balance Sheet as at 31st March, 2018:
Liabilities ` Assets `

Capital A/cs: Land and Building 5,00,000
X 3,00,000 Furniture 1,50,000
Y 2,00,000 Stock 2,00,000
Z 1,00,000 6,00,000 Bills Receivable 50,000
General Reserve 3,00,000 Sundry Debtors 75,000
Sundry Creditors 60,000 Cash at Bank 25,000
Bills Payable 40,000
10,00,000 10,00,000

W is to be admitted as a partner with effect from 1st April, 2018 on the following terms:
(a) W will bring in ` 1,50,000 as capital and ` 1,20,000 as premium for goodwill. Half of the goodwill
will be withdrawn by the partners.
(b) W will be entitled to 1/6th share of the profits of the firm.
(c) The assets will be revalued as: Land and Building—` 5,60,000; Furniture—` 1,20,000; Stock—
` 1,60,000 and Sundry Debtors—` 70,000.
(d) The claim of a creditor for ` 23,000 is paid as ` 20,000.
(e) Half of the General Reserve is to be withdrawn by the partners.
You are required to show Revaluation Account, Partners’ Capital Accounts and Balance Sheet of the new
firm.
[Ans.: Loss on Revaluation—` 12,000; Partners’ Capital A/cs: X—` 3,99,000; Y— ` 2,66,000;
Z—` 1,33,000; W—` 1,50,000; Balance Sheet Total—` 10,25,000;
Balance of Creditors—` 37,000; Cash at Bank—` 65,000.]