The above partners have always shared profits and losses in the ratio: Pitt 4: Lamb 2: Soul 1. From 1 January the assets were to be revalued as the profit sharing ratios are to be altered soon. The following assets are to be revalued to the figures shown: Buildings £106,000; Motor vehicles £13,000; Inventory £4,894; Office fittings £1,450. Required:

(a) You are required to show all the ledger accounts necessary to record the revaluation.

(b) Draw up a statement of financial position as at 1 January 2012.

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Pitt, Lamb and Soul Statement of Financial Position as at 31 December 2011 Buildings (at cost) Motor vehicles (at cost less depreciation) Office fittings (at cost less depreciation) Inventory Accounts receivable Bank Net assets Capitals: Pitt Lamb Soul Total capital 6,100 7,400 800 80,000 16,500 1,800 98,300 14,300 112,600 60,000 30,000 22,600 112,600