Raghu and Sam are partners in a firm sharing profits and losses in the ratio of 3:2. Their balance sheet as on 31st March, 2017 is as follows:
| Liabilities |
Rs. |
Rs. |
Assets |
Rs. |
Rs. |
| Capital accounts: |
|
|
Machinery |
|
30,000 |
| Raghu |
40,000 |
|
Furniture |
|
10,000 |
| Sam |
30,000 |
70,000 |
Stock |
|
10,000 |
| Sundry creditors |
|
30,000 |
Debtors |
21,000 |
|
| |
|
|
Less: Provision for |
|
|
| |
|
|
doubtful debts |
1,000 |
20,000 |
| |
|
|
Bank |
|
30,000 |
| |
|
1,00,000 |
|
|
1,00,000 |
Prakash is admitted on 1.4.2017 subject to the following conditions:
(a) He has to bring a capital of Rs.10,000
(b) Machinery is valued at Rs.24,000
(c) Furniture to be depreciated by Rs.3,000
(d) Provision for doubtful debts should be increased to Rs.3,000
(e) Unrecorded trade receivables of ` 1,000 would be brought into books now
Pass necessary journal entries and prepare revaluation account and capital account of partners after admission.
