X and Y are partners sharing profits wqually. Their Balance sheet as on 31st March, 2019 is given below:

Z is admitted as a new partner for 1/4th share under the following terms:
(a) Z is to introduce Rs 1,25,000 as capital.
(b) Goodwill of the firm was valued at nil.
(c) It is found that the creditors included a sum of Rs 7,500 which was not to be paid. But it was also found that there was a liability for Compensation to Workmen amounting toRs 10,000.
(d) Provision for doubtful debts is to be created @ 10% on debtors.
(e) In regard to the Partners' Capital Accounts present Fixed Capital Account Method is to be converted into Fluctuating capital Account Method.
(f) Bills of Rs 20,000 accepted from creditors were not recorded in the books.
(g) X provides Rs 50,000 loan to the business carrying interest @ 10% p.a.
You are required to prepare Revaluation Account, Partners' Capital Accounts, Bank Account and the Balance
sheet of the new firm.

Answer

Loss on Revaluation -₹5,000; Partners' Capital A/cs; X -Rs1,87,500;
Y-Rs1,27,500; Z-Rs1,25,000; Balance Sheet Total-Rs6,72,500.