SURANA IND.

PU COLLEGE

II PUC ACCOUNTANCY

BASM/SEBA/EBAC/HEBA
BATCH 2025 - 26

CHAPTER

ACCOUNTING FOR PARTNERSHIP –

ADMISSION OF A PARTNER

WORK SHEET

Candidate’s Name

Combination
Section A: One mark questions:
I. Fill in the blanks:
1. Old ratio is used to distribute accumulated profits and losses at the time of admission of a new
partner.
2. Profit or loss on revaluation is shared among the old partners in Old ratio.
3. Old ratio-New Ratio= Sacrificing Ratio.
4. Accumulated losses are transferred to the capital accounts of the old partners at the time of
admission in their Old ratio.
5. General reserve is to be transferred to Capital accounts at the time of admission of a new partner.
6. Goodwill brought in by new partner in cash is to be distributed among old partners in sacrificing
ratio.
7. If the amount brought by new partner is more than his share in capital, the excess is known as
Hidden goodwill
8. Asset Account is debited for the increase in the value of an asset.
9. Unrecorded asset is to be credited to Revaluation account.
10. Goodwill is an Intangible asset.
12. Goodwill account is credited for cash brought in by new partners for his share of goodwill.
14. New Profit Sharing ratio is required for sharing future profits and also for adjustment of capitals.

II. Multiple Choice Questions

1. At the time of admission of a new partner, general reserve appearing in the old balance
sheet in transferred to:
a) All partners Capital Account b) New Partner’s Capital Account
c) Old Partners Capital Account d) None of the above
2. A, B and C are partners in a firm. If D is admitted as a new partner
a) Old firm if dissolved
b) Old firm and old partnership are dissolved
c) Old partnership is reconstituted
d) None of the above

3. On the admission of a new partner, increase in the value of asset is credited to

a. Profit and Loss Adjustment (Revaluation) Account
b. Asset Account
c. Old partners Capital Account
d. None of the above
4. At the time of admission of a partner, undistributed profits appeared in the balance sheet
of the old firm is transferred to the capital accounts of
a) Old partners in old profit sharing ratio.
b) Old partners in new profit sharing ratio.
c) All the partners in new profit sharing ratio
d) None of the above.
5. If new Partner brings cash for his share of goodwill, goodwill is transferred to Old
Partners’ Capital Account in:
a) Sacrificing ratio b) Old Profit sharing ratio.
c) New Profit sharing ratio d) None of the above.

6. Which of the following are treated as reconstitution of a Partnership Firm?

a) Admission of a partner b) Change in profit sharing ratio
c) Retirement of a partner d) All the above
7. Profit or loss on revaluation is shared among the partners in the
a) Old profit sharing ratio b) New profit sharing ratio
 c) Capital ratio d) Equal ratio
8. Assets and Liabilities are recorded in Balance Sheet after the admission of a partner at:
a) Original Value b) Revalued Value
c) Realizable value d) None of the above
9. On the admission of a new partner, the increase in the value of an asset is credited to
a) Revaluation Account b) Asset Account
c) Old Partners Capital Account d) None of the above
10. Old Profit Sharing Ratio-New Profit Sharing Ratio is=
a) Sacrificing ratio b) Gaining ratio
c) Both the above d) None of the above.
11. In the absence of an agreement to the contrary, it is implied that old partners will
contribute to new partner’s share of profit in the ratio of
a) Capital b) Old profit sharing ratio
c) Sacrificing ratio d) Equally
12. The balance of reserves and other accumulated profits at the time of admission of a new
partner are transferred to;
a) All partners in the new ratio
b) Old partners in the new ratio
c) Old partners in the old ratio
d) Old partners in the sacrificing ratio
13. Goodwill raised in books at the time of admission of partners will be written off in:
a) Old profit sharing ratio b) New profit sharing ratio
c) Sacrificing ratio d) None of the above
14. Revaluation Account is debited for the
a) Increase in provision for doubtful debts
b) Increase in the value of building
c) Decrease in the amount of creditors
d) Transfer of loss on revaluation

III. True or False type questions

1. Goodwill brought in cash by new partner is distributed among old partners in their Sacrificing
ratio.= True
2. In case of admission of a partner, profit or loss on revaluation is transferred to Old Partners’
Capital Accounts.=True
3. Accumulated profit is transferred to all partner’s capital accounts including new partner.=False
4. The debit balance of Profit and Loss Account shown in the assets side of the Balance Sheet will
be debited to Old Partners Capital Accounts.=True
5. Increase in the value of an asset in credited to Revaluation Account=True
6. The traditional name of ‘Revolution A/c’ is ‘Profit and Loss Adjustment A/c’= True
7. Goodwill is an intangible asset.=True
8. Decrease in the value of liability is debited to Revaluation Account.=False
9. Share sacrificed=Old share-New share.= True
IV. Very Short answer type questions:
1. What is partnership?
Ans: Partnership is the relation between two or more persons who join hands to set up a business
and share its Profits or Losses.
2. What do you mean by reconstitution of a Partnership Firm?
Ans: Reconstitution of a Partnership Firm means change in the existing agreement, relations and
composition of members.
3. State any one reason for admission of a new partner.
Ans: To increase the Capital
4. State any one right acquired by a newly admitted partner
Ans: Right to share the assets or profits of the partnership firm
5. Why the NPSR is required at the time of admission of a partner?
Ans: NPSR is required to share the future profits or losses.
6. What is Goodwill?
Ans: Goodwill is the monetary value of good name, reputation and wide business connections.
7. State any one factor affecting the value of goodwill.
Ans: Nature of business
8. What is normal profit?
Ans: Normal profit means normal return on capital employed.
9. State any one method of valuation of goodwill.
Ans: Average profit method
10. Give the formula for sacrificing ratio
Ans: Sacrificing Ratio = Old Ratio - New Ratio
11. Which account is to be debited to record the increase in the value of assets?
Ans: Asset A/c.
12. What is Revaluation Account?
Ans: Revaluation A/c is an a/c prepared in connection with recording of increase or decrease in
value of assets and liabilities and to find out the P/L on revaluation.
13. Which account will be credited when there is a loss on revaluation?
Ans: Revaluation A/c
14. Which account will be debited when the cash is brought by a new partner for his share of
goodwill?
Ans: Cash/Bank A/c
15. What is hidden goodwill?
Ans: Hidden goodwill refers to the difference between total required capital and actual capital of
all partners.

Section B: Two Marks Questions

1. When the goodwill is distributed among old partners in the sacrificing ratio?
Ans: When goodwill is brought in cash by new partner, it is distributed in sacrificing ratio
2. State any two methods of valuation of goodwill.
Ans: a- Average profit method
b- Super Profit method
3. State any two rights acquired by a new partner.
Ans: a - Right to share the assets of the firm
b - Right to share profits of the firm

4. Pass the journal entry to write off the goodwill raised to the extent of full value.
Ans: All Partners’ Capital A/cs Dr xx—
To Goodwill A/c --------------------------------------------------------xx
( Being writing off of full value of goodwill)
5. State any two matters which need adjustments in the books of the firm at the time of
admission of a new partner.
Ans: a- Revaluation of assets and liabilities
b- Valuation and adjustment of goodwill
7. What is sacrificing ratio?
Ans: Sacrificing ratio refers to the ratio in which the old partners agree to sacrifice their share of
profit in favor of the new partner.
8. What is the need for the revaluation of assets and liabilities on the admission of a partner?
Ans: The need for the revaluation of assets and liabilities is to ascertain true financial position of
the business.
9. State any two reasons for admitting a new partner.
Ans: a- To increase the capital b- To improve the managerial ability
11. How do you close revaluation account when there is a profit?
 Ans: If there is profit, revaluation a/c is closed by debiting revaluation a/c and crediting old
partners capital a/cs
12. State any two factors which determine the goodwill of the firm.
Ans: a- Nature of the business b- Location of the business
13. Goodwill of the firm valued at two years purchase of the average profit of last four years.
The total profits for last four years are Rs.40, 000. Calculate the goodwill of the firm.
Ans: a- Average Profit - Total Profit /No of years
= 40,000/ 4
= Rs.10, 000
b- Goodwill = Average Profit x No of years purchase
= 10,000 x 2
= Rs.20,000
15. Pass the journal entry for increase in the value of building on the admission of a partner.
Ans: Building A/c Dr XX---
To Revaluation A/c ---XX
(Being increase in the value of building)
16. Pass the journal entry for the decrease in the value of a liability.
Ans: Liability A/c Dr XX---
To Revaluation A/c--------------------------------------- XX
(Being decrease in the value of liability)
Revaluation account
Particulars Amount Particulars Amount
To Depreciation on assets/ By Appreciation on assets/Increase in
Decrease in value of assets XXX value of assets XXX
To Provision for Bad debts/RBDD To XXX By Prepaid XXX
Outstanding Expenses XXX By Partner’s Capital acc (Balancing XXX
amt)
To Partner’s Capital acc XXX
(Balancing
Amt)
XXX XXX

Partner’s Capital Account

Particulars A B C Particulars A B C

To P/L XXX XXX By Balance b/d XXX XXX ----

a/c(Asset Side) By Cash (Capital ---- ---- XXX
To Revaluation +G/W)
------
XXX XXX
loss By reserve fund XXX XXX -----
By P/L a/c(Liability) XXX XXX ------
To Cash a/c By Revaluation Profit XXX XXX ------
(G/W XXX XXX By NP Capital a/c
XXX XXX -----
withdrawn) (G/W)

To balance c/d
(Balancing amt) XXX XXX XXX

XXX XXX XXX XXX XXX XXX

1. Mahendra and Surendra are partners sharing profits and losses equally. Their Balance Sheet as on 31.3.2017
was as follows.
Liabilities Rs Assets Rs
Creditors 40,000 Buildings 40,000
Reserve Fund 17,000 Machinery 36,000
Motor Car 18,000
Capitals: Stock 39,000
Mahendra: 80,000 Debtors 30,000
1,20,000 Cash 14,000
Surendra: 40,000

1,78,000 1,77,000

On 1.4.2017 they admit Chandra as a partner for 1/6th share on the following terms:
a. He should bring Rs. 36,000 in cash for capital & 10,000 for goodwill.
b. Motor car and machinery to be depreciated by 5% and 10% respectively.
c. Prepaid rent 800
d. Appreciate Building by 20%
e. RBD at 5% on Debtors.
Prepare: (i) Revaluation Account
2. X and Y are partners sharing profits and losses 3:2. Their Balance Sheet as on 31.3.2017 was as follows.
Liabilities Rs Assets Rs
Creditors 50,000 Buildings 50,000
Reserve Fund 5,000 Machinery 20,000
Profit & Loss A/c 5,000
Capitals: Stock 10,000
X: 40,000 Debtors 30,000
60,000 Cash 10,000
Y: 20,000

1,20,000 1,20,000

On 1.4.2017 they admit Z as a partner for 1/5th share on the following terms:
a. He should bring Rs. 20,000 in cash for capital & 5,000 for goodwill.
b. Machinery to be depreciated by 5%.
c. Prepaid rent 1200
d. Appreciate Building by 25%
e. RBD at 10% on Debtors.
Prepare: (i) Revaluation Account
3. 2 and 3 are partners sharing profits and losses 3:2. Their Balance Sheet as on 31.3.2017 was as follows.
Liabilities Rs Assets Rs
Creditors 25,000 Buildings 35,000
Reserve Fund 20,000 Machinery 25,000
Profit & Loss A/c 10,000 Investments 15,000
Capitals: Stock 10,000
1: 40,000 Debtors 20,000
60,000 Cash 10,000
2: 20,000

1,15,000 1,15,000

On 1.4.2017 they admit 4 as a partner for 1/5th share on the following terms:
a. He should bring Rs. 25,000 in cash for capital & 10,000 for goodwill.
b. Machinery to be depreciated by 5%.
c. Appreciate Building by 15%
d. RBD at 10% on Debtors.
e. Decrease stock by 10%
Prepare: (i) Revaluation Account
4. Idly and Sambar are partners sharing profits and losses 6:4. Their Balance Sheet as on 31.3.2017 was as
follows.
Liabilities Rs Assets Rs
Creditors 60,000 Buildings 70,000
Reserve Fund 15,000 Machinery 20,000
Bills Payable 10,000 Investments 7,000
Capitals: Debtors 25,000
Idly: 30,000 Cash 8,000
50,000 Profit & Loss A/c 5,000
Sambar: 20,000

1,35,000 1,35,000

On 1.4.2017 they admit Chutney as a partner for 1/5th share on the following terms:
a. He should bring Rs. 30,000 in cash for capital & 20,000 for goodwill. Goodwill is withdrawn
by old Partners
b. Machinery to be depreciated by 10%.
c. Appreciate Building by 20%
d. RBD at 10% on Debtors.
e. Outstanding Expenses 2,000
Prepare: (i) Revaluation Account
 5. Ajay and Vijay are partners sharing profits and losses 4:1. Their Balance Sheet as on 31.3.2018 was as
follows.
Liabilities Rs Assets Rs
Creditors 70,000 Buildings 80,000
Reserve Fund 10,000 Machinery 40,000
Bills Payable 22,000 Stock 10,000
Capitals: Debtors 40,000
Ajay: 80,000 Cash 20,000
1,00,000 Profit & Loss A/c 12,000
Vijay: 20,000

2,02,000 2,02,000

On 1.4.2018 they admit Sanjay as a partner for 1/4th share on the following terms:
a. He should bring Rs. 50,000 in cash for capital & 30,000 for goodwill. Goodwill is withdrawn
by Old partners.
b. Machinery to be depreciated by 10%.
c. Appreciate Building by 20%
d. Bad debts at 5% on Debtors.
e. Decrease stock by 10%
f. Outstanding Expenses 600
Prepare: (i) Revaluation Account
 Case 1: When the new partner brings in cash for capital and goodwill (Goodwill is retained in the
business) Note: Goodwill amount to be added to cash in balance sheet
6. Mahendra and Surendra are partners sharing profits and losses equally. Their Balance Sheet as on 31.3.2017
was as follows.
Liabilities Rs Assets Rs
Creditors 41,000 Buildings 40,000
Reserve Fund 16,000 Machinery 36,000
Motor Car 18,000
Capitals: Stock 39,000
Mahendra: 80,000 Debtors 30,000
1,20,000 Cash 14,000
Surendra: 40,000

1,77,000 1,77,000

On 1.4.2017 they admit Chandra as a partner for 1/6th share on the following terms:
a. He should bring Rs. 36,000 in cash for capital & 12,000 for goodwill. (as per AS 26)
b. Motor car and machinery to be depreciated by 10% and 3,800 respectively.
c. Prepaid rent 600
d. Appreciate Building by 20%
e. RBD at 10% on Debtors.
Prepare: (i) Revaluation Account (ii) All partners Capital A/c (iii) New Balance Sheet
7. First floor and Second floor are partners sharing profits and losses 3:2. Their Balance Sheet as on 31.3.2017
was as follows.
Liabilities Rs Assets Rs
Creditors 40,000 Buildings 50,000
Reserve Fund 12,000 Machinery 20,000
Profit & Loss A/c 6,000
Capitals: Stock 10,000
First floor: 40,000 Debtors 20,000
60,000 Cash 18,000
Second floor: 20,000

1,18,000 1,18,000

On 1.4.2017 they admit Third floor as a partner for 1/5th share on the following terms:
a. He should bring Rs. 30,000 in cash for capital & 10,000 for goodwill.
b. Machinery to be depreciated by 10%.
c. Prepaid rent 500
d. Appreciate Building by 20%
e. RBD at 5% on Debtors.
Prepare: (i) Revaluation Account (ii) All partners Capital A/c (iii) New Balance Sheet
 8. Commerce and Arts are partners sharing profits and losses 4:1. Their Balance Sheet as on
31.3.2018 was as follows.
Liabilities Rs Assets Rs
Creditors 80,000 Buildings 1,00,000
Reserve Fund 20,000 Machinery 30,000
Bills Payable 20,000 Stock 20,000
Capitals: Debtors 40,000
Commerce: 80,000 Cash 20,000
1,00,000 Profit & Loss A/c 10,000
Arts: 20,000

2,20,000 2,20,000

On 1.4.2018 they admit Science as a partner for 1/4th share on the following terms:
a. He should bring Rs. 50,000 in cash for capital & 30,000 for goodwill.
b. Machinery to be depreciated by 5%.
c. Appreciate Building by 15%
d. Bad debts at 5% on Debtors.
e. Decrease stock by 10%
f. Outstanding Expenses 1000
Prepare: (i) Revaluation Account (ii) All partners Capital A/c (iii) New Balance Sheet
(Note: P/L a/c to be taken in Partner’s capital account Debit side)
When the new partner brings in cash for capital and goodwill (Goodwill is withdrawn by Old Partners)
Note: Goodwill amount not to be added to cash in balance sheet
9. Sachin and Rahul are partners sharing profits and losses equally. Their Balance Sheet as on 31.3.2017
was as follows.
Liabilities Rs Assets Rs
Creditors 40,000 Buildings 40,000
Reserve Fund 8,000 Machinery 36,000
Motor Car 8,000
Capitals: Stock 39,000
Sachin: 80,000 Debtors 31,000
1,20,000 Cash 14,000
Rahul: 40,000

1,68,000 1,68,000

On 1.4.2017 they admit Ganguly as a partner for 1/6th share on the following terms:
a. He should bring Rs. 25,000 in cash for capital & 10,000 for goodwill. Goodwill is Withdrawn
by Old Partners.
b. Motor car and machinery to be depreciated by 10%.
c. Prepaid rent 1000
d. Appreciate Building by 20%
e. RBD at 10% on Debtors.
Prepare: (i) Revaluation Account (ii) All partners Capital A/c (iii) New Balance Sheet
10. Accounts and Business are partners sharing profits and losses 3:2. Their Balance Sheet as on
31.3.2017 was as follows.
Liabilities Rs Assets Rs
Creditors 50,000 Buildings 60,000
Reserve Fund 5,000 Machinery 20,000
Profit & Loss A/c 3,000
Capitals: Stock 10,000
Accounts: 40,000 Debtors 20,000
60,000 Cash 8,000
Business: 20,000

1,08,000 1,08,000

On 1.4.2017 they admit Language as a partner for 1/5th share on the following terms:
a. He should bring Rs. 25,000 in cash for capital & 15,000 for goodwill. Goodwill is withdrawn
by old Partners.
b. Machinery to be depreciated by 10%.
c. Appreciate Building by 20%
d. RBD at 10% on Debtors.
Prepare: (i) Revaluation Account (ii) All partners Capital A/c (iii) New Balance Sheet
11. ICC and BCCI are partners sharing profits and losses 3:2. Their Balance Sheet as on 31.3.2017 was as
follows.
Liabilities Rs Assets Rs
Creditors 25,000 Buildings 35,000
Reserve Fund 10,000 Machinery 16,000
Profit & Loss A/c 16,000 Investments 20,000
Capitals: Stock 10,000
You & Me : 40,000 Debtors 20,000
60,000 Cash 10,000
Me & You : 20,000

1,11,000 1,11,000

On 1.4.2017 they admit Others as a partner for 1/5th share on the following terms:
a. He should bring Rs. 40,000 in cash for capital & 20,000 for goodwill. Goodwill is withdrawn
by old partners
b. Machinery to be depreciated by 10%.
c. Appreciate Building by 20%
d. RBD at 10% on Debtors.
e. Decrease stock by 5%
f. Outstanding expenses 1400
Prepare: (i) Revaluation Account (ii) All partners Capital A/c (iii) New Balance Sheet
 12. Ajay and Vijay are partners sharing profits and losses 4:1. Their Balance Sheet as on 31.3.2018 was as
follows.
Liabilities Rs Assets Rs
Creditors 70,000 Buildings 80,000
Reserve Fund 20,000 Machinery 40,000
Bills Payable 20,000 Stock 20,000
Capitals: Debtors 40,000
Ajay: 80,000 Cash 20,000
1,00,000 Profit & Loss A/c 10,000
Vijay: 20,000

2,10,000 2,10,000

On 1.4.2018 they admit Sanjay as a partner for 1/4th share on the following terms:
a. He should bring Rs. 50,000 in cash for capital & 30,000 for goodwill. Goodwill is withdrawn
by Old partners.
b. Machinery to be depreciated by 5%.
c. Appreciate Building by 20%
d. Bad debts at 5% on Debtors.
e. Decrease stock by 10%
f. Outstanding Expenses 600
g. Prepaid Salary 1200
Prepare: (i) Revaluation Account (ii) All partners Capital A/c (iii) New Balance Sheet
(Note: P/L a/c to be taken in Partner’s capital account Debit side)
 Type 3 : When the new partner brings in cash for capital and goodwill (Half Goodwill is withdrawn by
old partners Note: Half Goodwill amount to be added to cash in balance sheet
13. S1 and S2 are partners sharing profits and losses in the ratio of 3:2. Their Balance Sheet as on 31.3.2018 was
as follows.
Liabilities Rs Assets Rs
Creditors 47,000 Buildings 60,000
Bills payable 25,000 Machinery 60,000
General Reserve 30,000 Investments 20,000
Capitals: Stock 25,000
So: 60,000 Debtors 20,000
1,00,000 Cash 5,000
So So: 40,000
Profit & Loss A/c 12,000
2,02,000 2,02,000

On 1.4.2018 they admit S3 as a partner for 1/5th share on the following terms:
a. He should bring Rs. 45,000 in cash for capital & 20,000 for goodwill.
b. Half of the Goodwill is withdrawn by old partners.
c. Appreciate Building by 10%
d. Depreciate machinery by 10%
e. RBD at 5% on Debtors.
Prepare: (i) Revaluation Account (ii)All partners Capital A/c (iii) New Balance Sheet
14. BASM and SEBA are partners sharing profits and losses equally. Their Balance Sheet as on
31.3.2017 was as follows.
Liabilities Rs Assets Rs
Creditors 40,000 Buildings 40,000
Bank loan 18,000 Machinery 36,000
Motor Car 18,000
Capitals: Stock 39,000
BASM: 80,000 Debtors 31,000
1,20,000 Cash 14,000
SEBA: 40,000

1,68,000 1,68,000

On 1.4.2017 they admit HEBA as a partner for 1/6th share on the following terms:
a. He should bring Rs. 36,000 in cash for capital & 10,000 for goodwill.
b. Half of the goodwill is withdrawn by old partners
c. Motor car and machinery to be depreciated by 20% and 1,800 respectively.
d. Appreciate Building by 10%
e. RBD at 10% on Debtors.
Prepare: (i) Revaluation Account (ii) All partners Capital A/c (iii) New Balance Sheet
 15. Gowri and Ganesh were partners sharing profit and losses in the ratio 2:1. Their Balance Sheet as
on 31.3.2020 was as under.
Balance Sheet as on 31.3.2020
Liabilities Rs Assets Rs
Creditors 20000 Cash in Hand 7000
Bills Payable 4000 Stock 25000
General reserve 6000 Buildings 40000
Capitals Debtors 17000
Gowri 80000 Less: PDD 1500 15500
Ganesh 40000 Furniture 14500
Patents 30000
Plant and machinery 18000
150000 150000
On 1/4/2020, Shiva was admitted into the partnership on the following terms.
a. Shiva should bring Rs 25000 as capital. Goodwill Rs 12000(as per AS 26)
c. Stock is to be increased by 8%
d. Provision for doubtful debts is increased to Rs 2600.
Prepare: Revaluation Account, Partners Capital Account and Balance sheet of the new firm.
16. Rekha and Surekha are partners in a firm sharing profits and losses in the ratio of3:2.Their balance sheet is
given below:
BalanceSheetason31.03.2024
Liabilities ₹ Assets ₹
Creditors 18,000 Cash at Bank 20.000
o/s Salary 12,000 Sundry debtors 25,000
Reserve Fund 10,000 Less:PDD 2,000 23,000
Capitals: Stock 7,000
Rekha 60,000 Furniture 25,000
Surekha 40,000 100,000 Buildings 50.000
P&L Account 15,000
Total 1,40,000 Total 1,40,000
On 01.04.2024, they admit Chandrika as new partner into partnership on the following terms:
a. She brings in 40,000 as capital and 20,000 towards goodwill for 1/4th share in future profits. (asperAS26)
b. Depreciate Furniture by 10% and buildings are revalued at 45,000.
c. PDD is increased to 3,500.
d. Prepaid insurance 2,000. Prepare:
i] Revaluation Account.
ii] Partners' Capital Accounts &
iii] New Balance sheet as on 01.04.2024.
 17. Gowri and Ganesh were partners sharing profit and losses in the ratio 2:1. Their Balance Sheet as
on 31.3.2020 was as under.
Balance Sheet as on 31.3.2020
Liabilities Rs Assets Rs
Creditors 20000 Cash in Hand 7000
Bills Payable 4000 Stock 25000
General reserve 6000 Buildings 40000
Capitals Debtors 17000
Gowri 80000 Less: PDD 1500 15500
Ganesh 40000 Furniture 14500
Patents 30000
Plant and machinery 18000
150000 150000
On 1/4/2020, Shiva was admitted into the partnership on the following terms.
a. Shiva should bring Rs 25000 as capital. Goodwill Rs 16000 (as per AS 26)
c. Stock is to be increased by 8%
d. Provision for doubtful debts is increased by Rs 2600.
Prepare: Revaluation Account, Partners Capital Account and Balance sheet of the new firm.
 18. Suresh and Shankar are partners in a firm sharing profits and losses in the ratio of 1 : 1.
Their balance sheet as on 31.03.2017 was as follows:
Balance Sheet as on 31.03.2017
Liabilities Amount Assets Amount
(`) (`)
Creditors 40,000 Cash at Bank 30,000
Bills Payable 45,000 Stock 25,000
Reserve Fund 15,000 Debtors 40,000
Capitals: Less: PDD 2,000 38,000
Suresh 60,000 Furniture 10,000
Shankar 40,000 1,00,000 Machinery 15,000
Profit and Loss A/c 30,000 Buildings 92,000
Patents 20,000
Total 2,30,000 Total 2,30,000

On 01.04.2017, they admitted Jagadish as a new partner for 1/4th share in the future profits on the
following terms.
a. Jagadish should bring in cash Rs. 70,000 as his capital and Rs. 35,000 towards Goodwill.
b. Depreciate Machinery by 10%.
c. Increase provision for doubtful debts by Rs. 4000.
d. Buildings are revalued at Rs. 1,20,500.
Prepare : i) Revaluation Account.
1. Partner's Capital Account and
2. New Balance sheet of the firm.

19. Tarun and Harish are partners in a firm. Their balance sheet as on 31.03.2024 was as follows:
Balance Sheet as on 31.03.2024
Liabilities ₹ Assets ₹
Creditors 1,50,000 Cash at Bank 50,000
General Reserve 50,000 Stock 50,000
Capitals: Furniture 1,20,000
Tarun 1,20,000 Debtors 40,000
Harish 80,000 Buildings 1,00,000
Investments 40,000
Total 4,00,000 Total 4,00,000
On01.04.2024 Krishna is admitted into the partnership on the following terms:
a)He brings in 60,000 as his capital and 20,000 towards goodwill for 1/4th share in the future profits.
a] Goodwill is to be withdrawn by the Old Partners. (asperAS26)
c) Depreciate Furniture by 10% and appreciate Buildings by 22,000.
d) Investments are to be revalued at 50,000.
e) Creditors were unrecorded to the extent of 5,000
Prepare:
i) Revaluation Account
ii] Partners' Capital Accounts &
iii] New Balance Sheet of the firm.
 20. Malaprabha, Ghataprabha and Hiranyakeshi are partners in a firm sharing profits and losses in the ratio of
2:1:1. Their Balance Sheet as on 31.03.2024 was as follows:
Balance Sheet as on 31.03.2024
Liabilities ₹ Assets ₹
Creditors 1,00,000 CashatBank 17,000
Reservefund 32,000 BillsReceivable 19,000
BankOD 8,000 Debtors 1,20,000
Capitals: Less:PDD 6,000
Malaprabha 40,000 Stock 80,000
Ghataprabha 50,000 Buildings 60,000
Hiranyakeshi 60,000
Total 2,90,000 Total 2,90,000
On01.04.2024,they admit Krishna into the partnership for 1/5th share in future profits on the following terms:
a)Krishna brings 50,000 as her capital.
b. Goodwill of the firm is valued at 60,000 (asperAS-26)
c. Reduce Stock by 10% and appreciate Buildings to 70,000.
d]Provision for doubtful debts decreased by 2,000.
Prepare:
Revaluation Account
Partners' Capital Accounts & New Balance Sheet of the new firm.
21. Surekha and Sunita are partners in a firm. Their Balance Sheet as on 31.03.2017 was as
follows :
Balance Sheet as on 31.03.2017

Liabilities Amount Assets Amount

(`) (`)
Creditors 1,50,000 Cash at Bank 50,000
General Reserve 50,000 Stock 50,000
Furniture 1,20,000

Capitals: Debtors 40,000

Surekha 1,20,000 Buildings 1,00,000
Sunita 50,000 Investments 40,000

Total 4,00,000 Total 4,00,000

On 01.04.2017, Kavita is admitted into the partnership on the following terms.

a. She brings in Rs. 60,000 as capital and Rs. 20,000 towards Goodwill for 1/4th share in the
future profits.
b. Depreciate furniture by 10% and appreciate building by Rs. 22,000.
c. Investments are to be revalued at Rs. 50,000
d. Provide Rs. 2,000 for outstanding salary.
Prepare: i) Revaluation Account
1. Partner's Capital Accountsand
2. New Balance Sheet of the firm.
 22. Anil and Sunil are partners in a firm sharing profits in the ratio of 2:1. Their balance sheet as
on 31.03.2016 was as follows:
Balance Sheet as on 31.03.2016

Liabilities Amount Assets Amount

(`) (`)
Bills Payable 16,000 Cash 4,000
Sundry Creditors 5,000 Sundry Debtors 30,000
Reserve Fund 9,000 Stock 32,000

Capitals: Furniture 8,000

Anil 60,000 Buildings 56,000
Sunil 50,000 Motor Car 10,000

Total 1,40,000 Total 1,40,000

On 01.04.2016, they admitted Vimal for 1/4th share in future profits under the following terms.
a. He should bring cash for capital Rs. 40,000 and Rs. 30,000 for goodwill.
b. Half of the goodwill amount withdrawn by the old partners.
c. Buildings are revalued at Rs. 66,000 and make a provisiion for legal charges Rs. 700.
d. Stock and Motor Car be depreciated by 10% cash. e)
Provide for doubtful debts at 5% on debtors.
Prepare: i) Revaluation Account
1. Partner's Capital Account and
New Balance Sheet of the firm
23. Sharat and Bharat are sharing profits and losses in the ratio 2 : 1. Their Balance
Sheet as on 31.03.2018 was as follows :
Balance Sheet as on 31.03.2018

Liabilities Amount Assets Amount

(`) (`)
Creditors 12,000 Cash in Hand 10,000
Bills Payable 8,000 Debtors 5,000
Reserve Fund 9,000 Stock 10,000
Capitals: Furniture 4,000
Sharat 20,000 Buildings 40,000
Bharat 20,000 40,000

Total 69,000 Total 69,000

They admitted Kamat into partnership giving him1/4th share in the future profits on the
following terms :
a. The new partner should bring Rs. 25,000 as his capital.
b. The goodwill of the firm is valued at Rs. 24,000.
c. Value of buildings is to be appreciated by Rs. 7,000 and furniture to be appreciated by
Rs. 1,000.
d. Stock is valued at 10% less than the book value and there is an outstanding printing
bill for Rs. 400.
Prepare: i) Revaluation Account
1. Partner's Capital Account and
2. Balance Sheet of the new firm.
24. Vani and Sandhya are partners sharing profits and lossesin the proportion of 3/5 and
2/5. Their Balance Sheet as on 31.03.2018 was as follows :
Balance Sheet as on 31.03.2018

Liabilities Amount Assets Amount

(`) (`)
Creditors 77,500 Cash at Bank 21,500
Reserve Fund 20,000 Stock 39,000
P and L Account 5,000 Debtors 60,000
Capitals: Less: PDD 3,000 57,000
Vani 60,000 Furniture 10,000
Sandhya 30,000 Buildings 40,000
Machinery 25,000

Total 1,92,500 Total 1,92,500

On 01.04.2018, Chaya is admitted into partnership on the following terms.

a. She should bring Rs. 40,000 as capital for 1/6th share and Goodwill of the firm is
valued at Rs. 30,000.
b. Depreciate furniture by 10%.
c. Appreciate buildings by 20%
d. PDD is increased by Rs. 3,000.
e. An amount of Rs. 2,000 due to a creditor is not likely to be claimed and
hence to be written off.
Prepare: i) Revaluation Account
1. Partner's Capital Account and
2. New Balance Sheet of the firm.
1. Maya and Chaya are partners sharing profit and losses in the ratio of 3:2. They
admit Divya into partnership. The new profit-sharing ratio is agreed at 4:3:3
respectively. Find out the sacrifice ratio ofold partners.

2. Vijay and Sanjay are partners in a firm sharing profits and losses in the ratio of
5:3. They admit Ajayinto partnership. All the partners share profits and losses
equally. calculate the sacrifice ratio.
3. Harsha and Varsha are partners sharing profits and losses in the ratio of 3:2. They
admit Sparsha into the partnership. The new profit and sharing ratio are 5:4:3
respectively. Find out the sacrifice ratio ofthe old partners.

4. Kavitha and Anitha are partners sharing profit and losses in the ratio of 3:2. They
admit Sunitha intopartnership and all partners share profit and losses equally.
Calculate the sacrifice ratio.
1. Anil and Vishal are partners sharing profits in the ratio of 3:2. They admitted Sumit as a new
partnerfor 1/5th Share in future profits of the firm which he gets equally from Anil and
vishal. Calculatenew profit-sharing ratio of Anil, Vishal and Sumit.

2. A, B are partners sharing profits and losses in the ratio of 3:2. They admitted C for
1/6th share.Calculate the new profit-sharing ratio of all partners.
Avinash and Bhima are partners in a firm sharing profits in the ratio of 5:3. They admit Chandru as a
new partner for 1/7th share in the future profit. The new profit sharing ratio will be 4:2:1.
Calculate the sacrifice ratio of Avinash and Bhima

Ram and Laxman are partners in a firm. Following is their Balance Sheet as on 31.03.2024 Balance Sheet as on
31.03.2024
Liabilities ₹ Assets ₹
Creditors 16,000 Cash in Hand 10,000
Bills Payable 4,000 Stock 15,000
Capitals: Debtors 16,000
Ram 40,000
Laxman 20,000 furniture 4,000
Plant & Machinery 20,000
Land & Building 15,000
Total 80,000 Total 80,000
On01.04.2024,Bharat is admitted into partnership on the following terms:
a. Bharat should bring 16,000 as capital.
b]Goodwill of the firm is valued at 6,000.(asperAS26)
c. Provision for doubtful debts is to be increased by 1,000.
d. Machinery is to be depreciated by 10%.
e. Land & Buildings are to be increased by ₹5,000.
Capital Accounts of partners are to be adjusted in their new profit sharing ratio 3:2:1, based on Bharat's Capital
after adjusting goodwill.
(Adjustments to be made in cash):
i]Revaluation Account ii]Cash Account
iii]Partners' Capital Accounts & New Balance Sheet of the firm.
Incharge Sign Subject Teacher’s Sign