Following is the Balance Sheet of Amit and Vidya as at 31st March, 2017:
On the above date Chintan was admitted as a partner for 1/4 share of the profits of the firm with the following terms:
(i) Rs. 2,900 will be written off as bad debts.
(ii) Stock was taken over by Vidya at Rs. 35,000.
(iii) Goodwill of the firm was valued at Rs. 40,000. Chintan brought his share of goodwill premium in cash.
(iv) Chintan brought proportionate capital and the capitals of the other partners were adjusted on the basis of Chintan's capital. For this, necessary cash was to brought in or paid off to the partners as the case may be.
Prepare Revaluation Account and Partner's Capital Accounts.
[Ans - Profit on Revaluation Rs. 4,100; Cash brought in by Vidya Rs. 42,500; Cash paid to Amit Rs. 42,500; Capital brought in by Chintan Rs. 29,700; Closing balance of Capital Accounts - Amit Rs. 74,550; Vidya Rs. 74,550; Chintan Rs. 49,700]