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Dr. Partner’s Capital Account Cr.

Particular Bhavesh Chandra Alia Particulars Bhavesh Chandra Alia
(`) (`) (`) (`) (`) (`)
To Goodwill A/c 31,500 10,500 By Balance b/d 32,000 28,000
To Cash A/c 13,000 By General Reserve A/c 18,000 6,000
To Balance c/d 46,950 15,650 15,650 By Revaluation A/c 450 150
(Profit)
By Goodwill A/c 15,000 5,000
By Cash A/c 13,000 15,650
78,450 39,150 15,650 78,450 39,150 15,650

Balance Sheet As on 1.4. 2018

Particulars Amt (`) Amt (`) Particulars Amt (`) Amt (`)
Creditors 20,000 Cash 36,050
Workmen’s Compensation Reserve 30,000 Bank 20,000

Add: Increase 10,000 40,000 Debtors 13,000
Capitals : Less: Provision 1,000 12,000
Bhavesh 46,950 Bills Receivable 10,000
Chandra 15,650 Stock 20,000
Alia’s Capital 15,650 Accrued income 200
Land & Building 30,000 40,000
Add: Appreciation 10,000

1,38,250 1,38,250
Working Note :
Calculation of proportionate Capital

Bhavesh’s capital after adjustment ............. ` 33,950
Chandra’s capital after adjustment ............. ` 28,650
Total capital of Bhavesh and Chandra for 4/5 share ............. ` 62,600
Total Capital of the firm should be ............. ` 62,600 × 5/4 = 78,250
New profit sharing ratio of Bhavesh Chandra and Alia is 3:1:1
Bhavesh’s new Capital = ` 78,250 × 3/5
= ` 46,950

Chandra’s new Capital = ` 78,250 × 1/5
= ` 15,650
Alia’s new Capital = ` 78,250 × 1/5
= ` 15,650

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