A,B and C were in
partnership, sharing profits and losses as to A one-half, B one-third and C one-sixth
, as from 1st January,2016 they admitted D into partnership on the
following terms:
D to have a one-sixth
share which he purchased entirely from A paying A Rs.8,000 for the share of
goodwill. Of this amount, A had withdrawn Rs.6,000 and put the balance in the
firm as additional capital. As a condition to admission of D as a partner, D
also brought Rs.5,000 capital into the firm.. it was further agreed that the
investments should be valued at his market value of Rs.3,600 and plant be
valued at Rs.5,800
The balance sheet of
the old firm on 31.12.2015 was as follows:
Cash at bank
Rs.8,000; debtors Rs.12,000;stock Rs.10,000; Investments at cost Rs.6,000;
furniture Rs.2,000; plant Rs. 7,000; creditors Rs.21,000; Capital:A Rs.12,000;
B Rs.8,000 and C Rs.4000.
The profits for the
year 2016 were rs.12,000 and the drawings were A Rs.6,000, B Rs.6,000, C
Rs.3,000 and D Rs.3,000.
You are required to journalise the opening
adjustments, prepare the opening balance sheet of the new firm as on 1st
january,2016 and give the capital account of each partner as on 31st
December,2016.