A and B, carrying on business in partnership and sharing profits and losses in the ratio...
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A and B, carrying on business in partnership and sharing profits and losses in the ratio of 3: 2, require a partner, when their Balance Sheet stood as: Liabilities (Rs.) Assets They admit C into partnership and Cash 11,800 Stock Creditors A's Capital B's Capital 51,450 36,75088,200 (Rs.) 1,500 28,000 Debtors 19,500 Furniture 2,500 Machinery48,500 1,00,000 1,00,000 give him 1/8th share in the future profits on the following terms: (a) Goodwill of the firm be valued at twice the average of the last three years profits which amounted to Rs.21, 000; Rs.24, 000 and Rs.25, 560. (b) C is to bring in cash for the amount of his share of goodwill. (c) C is to bring in cash Rs. 15,000 as his capital. Pass Journal entries recording these transactions, draw out the Balance sheet of the new firm and state new profit sharing ratio. A and B, carrying on business in partnership and sharing profits and losses in the ratio of 3: 2, require a partner, when their Balance Sheet stood as: Liabilities (Rs.) Assets They admit C into partnership and Cash 11,800 Stock Creditors A's Capital B's Capital 51,450 36,75088,200 (Rs.) 1,500 28,000 Debtors 19,500 Furniture 2,500 Machinery48,500 1,00,000 1,00,000 give him 1/8th share in the future profits on the following terms: (a) Goodwill of the firm be valued at twice the average of the last three years profits which amounted to Rs.21, 000; Rs.24, 000 and Rs.25, 560. (b) C is to bring in cash for the amount of his share of goodwill. (c) C is to bring in cash Rs. 15,000 as his capital. Pass Journal entries recording these transactions, draw out the Balance sheet of the new firm and state new profit sharing ratio.
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Partners Capital Account Dr Cr To As Capital Ac 51450 To Bs Capital Ac 36750 To Cs C... View the full answer
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