A, B and C are partners sharing profits in the ratio of 5 : 3 : 2. Their Balance Sheet as on 31st March, 2018 is given below:
C retires on 30th June, 2018 and it was mutually agreed that:
(a) Building be valued at Rs. 22,00,000.
(b) Investments to be valued at Rs. 3,00,000.
(c) Stock be taken at Rs. 8,00,000.
(d) Goodwill of the firm be valued at two years purchase of the average profit of the past five years.
(e) C’* share of profits up to the date of retirement be calculated on the basis of average profit of the preceding three years. The profits of the preceding five years were as under:
(f) Amount payable to C to be transferred to his Loan Account carrying interest @ 10% p.a. Prepare Revaluation Account, Partners Capital Accounts and the Balance Sheet as at 30th June, 2018.
