Assignment Course Name: Corporate Accounting -1 Student Name: Section: 1 Assignment question Sam and Mike were partners

sharing profits equally. Their Balance Sheet as on March 31, 2010 was as follows: Liabilities Creditors Bills payable Out standing expenses Capital: Sam 60,000 Mike 40,000 Total Amount 50,000 15,000 3,000 Assets Cash Cash at Bank Debtors 20,000 Less Provision 500 Stock Furniture Machinery Land & Building Total Amount 12,000 15,000 19,500 20,000 10,000 18,000 73,500 168,000 Marks ____/10 Student ID: Due date: April 10, 2011

100,000 168,000

On that date, they agreed to admit Tom as a partner on the following terms: 1. Tom shall get 1/5th share in profits and he will bring RO. 20,000 as his capital and RO. 5,000 as his share of goodwill 2. Goodwill brought by Tom shall be withdrawn by Sam and Mike. 3. Provision for bad and doubtful debts should be brought up to 5% on debtors. 4. Machinery is depreciated by RO. 2,000 and furniture by 12.5 %. 5. Stock is valued at RO. 23,000. 6. Land & Building be appreciated by 20%, and 7. Investments of RO. 2,000 which did not appear in books should be duly recorded. Required: Record necessary journal entries and prepare the revaluation account and capital account of partners.
Profit on revaluation = Rs. 15,950 Balance of Capital accounts = Rs. 67,975, Rs. 47,975, Rs. 20,000 Total of Balance Sheet = Rs. 2,03,950