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12,400 16,320 Goodwill Plant and machinery Stock Debtors Cash at bank 6,420 4,100 626 11,146 ( 5,928) Sundry creditors 5,218 33,938 Capital: Fitch Wall 19,461 14,477 33,938 On 1 January 20X3, they decided to admit Home as a partner on the condition that she contributed £12,000 as her capital but that the plant and machinery and stock should be revalued at £16,800 and £6,100 respectively, the other assets excepting goodwill, remaining at their book values. The goodwill was agreed to be valueless. You are required to show: (a) The ledger entries dealing with the above in the following accounts: (i) Goodwill account, (ii) Revaluation accounts, (iii) Capital accounts; (b) The balance sheet of the partnership immediately after the admission of Home.

12,400 16,320 Goodwill Plant and machinery Stock Debtors Cash at bank 6,420 4,100 626 11,146 ( 5,928) Sundry creditors 5,218 33,938 Capital: Fitch Wall 19,461 14,477 33,938 On 1 January 20X3, they decided to admit Home as a partner on the condition that she contributed £12,000 as her capital but that the plant and machinery and stock should be revalued at £16,800 and £6,100 respectively, the other assets excepting goodwill, remaining at their book values. The goodwill was agreed to be valueless. You are required to show: (a) The ledger entries dealing with the above in the following accounts: (i) Goodwill account, (ii) Revaluation accounts, (iii) Capital accounts; (b) The balance sheet of the partnership immediately after the admission of Home.

Accounting
Accounting
27th Edition
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Chapter12: Accounting For Partnerships And Limited Liability Companies
Section: Chapter Questions
Problem 12.14EX
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43.2A Fitch and Wall have been in partnership for many years sharing profits and losses in the ratio 5:3 respectively. The following was their balance sheet as at 31 December 20X2. Chapter 43 • Revaluation of partnership asse £ Goodwill Plant and machinery Stock Debtors Cash at bank 12,400 16,320 6,420 4,100 626 11,146 ( 5,928) Sundry creditors 5,218 33,938 Capital: Fitch Wall 19,461 14,477 33,938 On 1 January 20X3, they decided to admit Home as a partner on the condition that she contributed £12,000 as her capital but that the plant and machinery and stock should be revalued at £16,800 and £6,100 respectively, the other assets excepting goodwill, remaining at their book values. The goodwill was agreed to be valueless. You are required to show: (a) The ledger entries dealing with the above in the following accounts: (i) Goodwill account, (ii) Revaluation accounts, (iii) Capital accounts; (b) The balance sheet of the partnership immediately after the admission of Home.
Transcribed Image Text:43.2A Fitch and Wall have been in partnership for many years sharing profits and losses in the ratio 5:3 respectively. The following was their balance sheet as at 31 December 20X2. Chapter 43 • Revaluation of partnership asse £ Goodwill Plant and machinery Stock Debtors Cash at bank 12,400 16,320 6,420 4,100 626 11,146 ( 5,928) Sundry creditors 5,218 33,938 Capital: Fitch Wall 19,461 14,477 33,938 On 1 January 20X3, they decided to admit Home as a partner on the condition that she contributed £12,000 as her capital but that the plant and machinery and stock should be revalued at £16,800 and £6,100 respectively, the other assets excepting goodwill, remaining at their book values. The goodwill was agreed to be valueless. You are required to show: (a) The ledger entries dealing with the above in the following accounts: (i) Goodwill account, (ii) Revaluation accounts, (iii) Capital accounts; (b) The balance sheet of the partnership immediately after the admission of Home.
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