A, B, and C were partners, sharing profits and losses in the proportion of 3 : 2 : 2 respectively. The Balance Sheet of the firm as on 1.1.2017 was as follows :A retired on 1.1.2017, on which date D was admitted as a new partner. For the purpose of adjusting the rights as among the old partners, goodwill was to be valued at ~ 42,000 and Sundry Debtors and Stock were to be reduced by ₹8,000 and ₹6,000 respectively. A was to receive ₹22,000 in cash on the date of retirement and the balance due to him was to remain on loan at 8% p.a., interest payable on 31st December each year on which date the firm closes its accounts. D was to bring in ₹50,000 in cash as his capital on the date of admission. The new partners were to share profits and losses equally after allowing interest on loan from A.

The net profit for the year ended 31.12.2017 was ₹33,200 before taking into account interest on loan from A. You are to prepare the following :

1. Capital Accounts of the partners as on 31.12.2017;

2. A’s Loan Account as on 31.12.2017;

3. Profit and Loss Appropriation Account for the year ended 31.12.2017.

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Capital Account -- A Capital Account- B Capital Account -- C Bank Overdraft Sundry Creditors Liabilities ₹ 50,000 Plant and Machinery 40,000 Furniture 35,000 Stock 10,000 Debtors 28,000 Cash at Bank 1,63,000 Assets ₹ 36,000 24,000 56,000 48,000 9,000 1,63,000