Question

X, Y, and Z are three partners. On the retirement of X assets and liabilities are revalued as under provision for doubtful debts reduced by Rs.1250, stock in trade increased by Rs.550, Building in increased by rs 4500. The remaining partner decides to re-state the assets and liabilities at the old book value after the retirement of X.The revaluation would be given effect by ___________.

• A. Y a/c Dr.,Z a/c Dr (each) Rs.1050,Credit X Rs.2100
• B. Y a/c Dr,Z a/c Dr (each) Rs.1400,Credit X Rs.2800
• C. Y a/c Dr,Z a/c Dr (each) Rs.2100,Credit X Rs.4200
• D. Y a/c Dr,Z a/c Dr (each) Rs.700,Credit X Rs.1400

Answer 1

The correct option is A Y a/c Dr.,Z a/c Dr (each) Rs.1050,Credit X Rs.2100

Revaluation A/c on the retirement of X

Particulars	Amount (Rs.)	Particulars	Amount (Rs.)
To Partner's Capital A/c ( X's Capital 2100) (Y's Capital 2100) ( Z's Capital 2100)	6300	By Provision for doubtful debts A/c By Stock in trade A/c By Building A/c	1250 550 4500
	6300		6300

X' share of revaluation gain = Total revaluation gain * X's share

X' share of revaluation = Rs. 6300 * (1/3) = Rs. 2100

Adjustment entry to give effect for revaluation is :

Y's A/c Dr. 1050

Z's A/c Dr. 1050

To X's A/c 2100