A and B are partners in a firm. Net profit of the firm is divided

66 :- A and B are partners in a firm. Net profit of the firm is divided as follows; 1/2  to A, 1/3 to B and 1/6 carried to a reserve. They admit C as a partner on 1^st April, 2025 on which date, the Balance Sheet of the firm was

Following are the required adjustments on admission of C
(a) C brings in Rs 25,000 towards his capital.
(b) C also brings in Rs 5,000 for 1/5th share of goodwill.
(c) Stock is undervalued by 10%.
(d) Creditors include a liability of Rs 4,000 which has been decided by the court at Rs 3,200.
(e) In regard to the debtors, the following debts proved Bad or Doubtful
Rs 2,000 due from X – bad to the full extent
Rs 4,000 due from Y – insolvent, estate expected to pay only 50%
You are required to prepare Revaluation account, partner’s capital accounts and balance sheet of the new firm.

Solution :-