Ravi, Mohan and Pandey were partners in a firm sharing profits and losses in the ratio of 7 : 8 : 9. On 31st March, 2022, their Balance Sheet was as follows:
Balance Sheet of Ravi, Mohan and Pandey as at 31st March, 2022
| Liabilities | Amount ₹ |
Assets | Amount ₹ |
|---|---|---|---|
| Creditors | 1,41,000 | Bank | 27,000 |
| General Reserve | 24,000 | Stock | 91,000 |
| Capitals: | Debtors 2,10,000 | ||
| Ravi 3,00,000 | Less: Provision for doubtful debts 10,000 |
2,00,000 |
|
| Mohan 4,00,000 | Machinery | 3,00,000 | |
| Pandey 8,43,000 | 15,43,000 | Land and Building | 10,00,000 |
| Profit and Loss Account (Loss of 2021 22) |
90,000 | ||
| 17,08,000 | 17,08,000 |
On 31st March, 2022, Mohan retired from the firm on the following terms:
(i) Goodwill of the firm was valued at ₹4,80,000.
(ii) Mohan’s share of goodwill will be credited to his capital account without opening goodwill account.
(iii) Debtors of ₹10,000 will be written off and a provision of 10% for bad and doubtful debts will be created on debtors.
(iv) Machinery will be depreciated by 10% and land and building will be appreciated by 5%.
(v) The balance in Mohan’s Capital Account will be transferred to his loan account.
Prepare Revaluation Account and Mohan’s Capital Account on Mohan’s retirement, in the books of the firm.
Marks-5, CBSE:2021-22/Compartment/Q-7*