Question:
Nita, Vidur and Mita were partners in a firm sharing profits and losses in the ratio of 3 : 4 : 1. On 1st April 2024, they decided to admit Samir as a new partner. The new profit sharing ratio between Nita, Vidur, Mita and Samir will now be 1 : 1 : 1 : 1. The balance sheet of Nita, Vidur and Mita before Samir’s admission showed machinery at ₹ 6,00,000. On the date of admission, it was found that the machinery is overvalued by 20%. The value of machinery shown in the new Balance Sheet after Samir’s admission will be :
Nita, Vidur and Mita were partners in a firm sharing profits and losses in the ratio of 3 : 4 : 1. On 1st April 2024, they decided to admit Samir as a new partner. The new profit sharing ratio between Nita, Vidur, Mita and Samir will now be 1 : 1 : 1 : 1. The balance sheet of Nita, Vidur and Mita before Samir’s admission showed machinery at ₹ 6,00,000. On the date of admission, it was found that the machinery is overvalued by 20%. The value of machinery shown in the new Balance Sheet after Samir’s admission will be :
Show Hint
When admitting a new partner, always adjust asset values to their fair market value before preparing the new balance sheet.
Updated On: Jul 4, 2025
- ₹ 7,50,000
- ₹ 4,80,000
- ₹ 7,20,000
- ₹ 5,00,000
Hide Solution
Verified By Collegedunia
The Correct Option is B
Solution and Explanation
Step 1: Find the overvaluation amount.
\[ \text{Overvaluation} = 20% \text{ of } ₹ 6,00,000 = ₹ 1,20,000 \] Step 2: Reduce the machinery to its fair value.
\[ \text{Correct Machinery Value} = ₹ 6,00,000 - ₹ 1,20,000 = ₹ 4,80,000 \] Final Answer: ₹ 4,80,000
\[ \text{Overvaluation} = 20% \text{ of } ₹ 6,00,000 = ₹ 1,20,000 \] Step 2: Reduce the machinery to its fair value.
\[ \text{Correct Machinery Value} = ₹ 6,00,000 - ₹ 1,20,000 = ₹ 4,80,000 \] Final Answer: ₹ 4,80,000
Was this answer helpful?
0
0
Top Questions on Admission of a Partner
- Kishore and Ranjan were partners in a firm sharing profits and losses in the ratio of 3 : 2. On 1stApril, 2024, their Balance Sheet was as follows :
Balance Sheet of Kishore and Ranjan as at 1stApril, 2024On the above date, Singh was admitted as a new partner on the following terms :Liabilities Amount (₹) Assets Amount (₹) Sundry Creditors 1,80,000 Cash in hand 30,000 General Reserve 20,000 Debtors 1,20,000 Capitals: Kishore – 6,00,000 Stock 1,50,000 Ranjan – 4,00,000 Furniture 1,00,000 Land and Building 8,00,000 Total 12,00,000 Total 12,00,000
(i) Singh will bring \(₹1,50,000\) as his capital and \(₹50,000\) as his share of goodwill premium.
(ii) The value of stock will be reduced by 10% and Land and Building will be appreciated by 10%.
(iii) Furniture will be revalued at \(₹90,000\).
(iv) A provision for doubtful debts will be created on sundry debtors at 5%.
(v) Investments worth \(₹10,000\) not mentioned in the Balance Sheet will be taken into account.
(vi) A creditor of \(₹1,000\) is not likely to claim his money and is to be written off.
Pass necessary journal entries for the above transactions in the books of the firm on Singh's admission.- CBSE CLASS XII - 2025
- Accountancy
- Admission of a Partner
- Aman, Govind and Guru shared profits 3 : 2 : 1. Sudarshan admitted for \( \frac{1}{4} \) share. New ratio = 9 : 5 : 4 : 6. Total capital of new firm = ₹ 3,60,000. Sudarshan brings \( \frac{1}{4} \) of total as capital. Capitals of Aman, Govind and Guru adjusted accordingly. New capitals of Aman, Govind and Guru were ₹ 60,000, ₹ 80,000 and ₹ 45,000 respectively. Calculate the new capitals and pass necessary journal entries.
- CBSE CLASS XII - 2025
- Accountancy
- Admission of a Partner
- Ajay and Parth sharing 2:1. Vinod admitted. New ratio = 2:1:1. What is Ajay’s sacrifice?
- CBSE CLASS XII - 2025
- Accountancy
- Admission of a Partner
- John and Harry were partners in a firm sharing profits and losses in the ratio of 2 : 1. On 1stApril, 2023, they admitted Dinesh as a new partner for \(\frac{1}{4}\) share in the profits of the firm with a guarantee that his share in the profits shall be at least \(₹1,00,000\). The net profit of the firm for the year ended 31stMarch, 2024 was \(₹2,80,000\). John’s share in the profits of the firm after giving the guaranteed amount of profit to Dinesh will be :
- CBSE CLASS XII - 2025
- Accountancy
- Admission of a Partner
- Rani, Maharani and Laxmi were partners in a firm sharing profits and losses in the ratio of 3 : 3 : 2. On 1stApril, 2024 they admitted Reena as a new partner for \( \frac{1}{5} \) share in the profits of the firm. Reena acquired her share from Rani and Maharani in the ratio of 3 : 2. The new profit sharing ratio between Rani, Maharani, Laxmi and Reena will be :
- CBSE CLASS XII - 2025
- Accountancy
- Admission of a Partner
View More Questions
Questions Asked in CBSE CLASS XII exam
- The monetary policy is formulated by the ____ in the Indian economy.
- CBSE CLASS XII - 2025
- Money and Banking
- "The government generally levies higher Goods and Services Tax (GST) on socially undesirable products like cigarettes, tobacco, liquor etc." Identify and explain the indicated government budget objective in the above statement.
- CBSE CLASS XII - 2025
- Government Budgeting
- Find the values of \( a \) for which \( f(x) = \sin x - ax + b \) is increasing on \( \mathbb{R} \).
Two batteries of emf's \(3V \& 6V\) and internal resistances 0.2 Ω \(\&\) 0.4 Ω are connected in parallel. This combination is connected to a 4 Ω resistor. Find:
(i) the equivalent emf of the combination
(ii) the equivalent internal resistance of the combination
(iii) the current drawn from the combination- CBSE CLASS XII - 2025
- Electrical Circuits
Four students of class XII are given a problem to solve independently. Their respective chances of solving the problem are: \[ \frac{1}{2},\quad \frac{1}{3},\quad \frac{2}{3},\quad \frac{1}{5} \] Find the probability that at most one of them will solve the problem.
View More Questions