Karuna and Ramen are partners in a firm. They share profits and losses as Karuna 60% and Ramen 40%. Their Balance Sheet as on 31st December, 2017 was as follows:The partners agree to admit Pratip as a partner on the following terms:

(a) Plant was to be reduced by 10% and a provision for Doubtful Debts @ 2.5% on Debtors is to be made.

(b) The Motor Car is to be taken by Karuna for her personal use at a cost of 8,000.

(c) Pratip is to pay ₹20,000 as Goodwill premium to the old partners and the said amount is to remain in the business.

(d) Pratip is to get 1/4th share of the future profits of the firm and is also to introduce half the combined adjusted Capital of the old partners. Show the journal entries in the books of the firm and prepare the Balance Sheet of the new firm.

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Creditors Capital -- Karuna. Capital -- Ramen Liabilities ₹ 60,000 Plant 1,00,000 Motor car 60,000 Stock 2,20,000 Debtors Cash Assets ₹ 50,000 10,000 40,000 1,10,000 10,000 2,20,000