2) V and K were partners sharing profits and losses as 60% to V and 40% to K. Their Balance Sheet asat 1st January, 2005 stood as underBalance SheetLiabilitiesAmountAssetsAmountSundry creditorsBills Payable96,000Cash in Hand4,00056,00034,000Sundry debtors40,000Capital accounts:V:StockPlant & machineryLand & Buildings90,00080,000K:80,000170,000120,000300,000300,000The partners agreed to admit E into the firm subject to revaluation of the following items: (i) Stock was to bereduced by R.O 4.000 (ii) Land and Buildings were to be valued at R.O 160,000 (iii) A provisíon of 2 ½% was to becreated for doubtful debtors (iv) A liability of R.O 2,600 for outstanding expenses had been omitted to be recordedin the books. E contributed R.O 60,000 as his share of capital.Required: Prepare the revaluation account, capital accounts and the balance sheet after the above adjustment.(Ans. Profit on Revaluation: R.O 32,000; Balance Sheet Total: R.O 334,600)

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Description: 2) V and K were partners sharing profits and losses as 60% to V and 40% to K. Their Balance Sheet asat 1st January, 2005 stood as underBalance SheetLiabilitiesAmountAssetsAmountSundry creditorsBills Payable96,000Cash in Hand4,00056,00034,000Sundry d

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at 1st January, 2005 stood as under Balance Sheet Liabilities Amount Assets Amount Sundry creditors Bills Payable Capital accounts: v: K: 96,000 34,000 4,000 56,000 Cash in Hand Sundry debtors Stock 40,000 80,000 90,000 Plant & machinery Land & Buildings 80,000 170,000 120,000 300,000 300,000 The partners agreed to admit E into the firm subject to revaluation of the following items: (i) Stock was to reduced by R.Ó 4.000 (ii) Land and Buildings were to be valued at R.O 160,000 (iii) A provisíon of 2 2% w

at 1st January, 2005 stood as under Balance Sheet Liabilities Amount Assets Amount Sundry creditors Bills Payable Capital accounts: v: K: 96,000 34,000 4,000 56,000 Cash in Hand Sundry debtors Stock 40,000 80,000 90,000 Plant & machinery Land & Buildings 80,000 170,000 120,000 300,000 300,000 The partners agreed to admit E into the firm subject to revaluation of the following items: (i) Stock was to reduced by R.Ó 4.000 (ii) Land and Buildings were to be valued at R.O 160,000 (iii) A provisíon of 2 2% w

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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