Case -3

Hamed and Mohsin are the partners of AL Sabeel Technicals in Ibra, sharing profits

and losses in the ratio of 3:2 and admitted Said on 31st December 2019 into their

partnership. They agreed to give him 1/6th share of the firm. After admission they revalued

their assets and liabilities and prepared new balance sheet. Firms revaluation account

and new balance sheet are given below.fig 1

You are required to prepare;

a) Balance sheet of Hamad and Mohsin on 31st December (5 marks)

b) Capital accounts of all partners (3 marks)

c) Why is it necessary to ascertain new profit sharing ratio even for old partners when a new partner is admitted? (2 marks)

fig2

Revaluation Account As on 1st January 2020 Date Particulars Date Particulars Amount (OMR) Furniture 1000 Debtors 1000 Stock Plant Machinery Amount (OMR) 1000 and 3000 Profit Hamed Mohsin 4 800 |3200 Creditor Investment 5000 1000 10 000 10 000 Fig1 Liabilities Amount (OMR) Assets Creditors Balance Sheet As on 1st January 2020 Amount (OMR) 40,000 9,000 6,000 9,000 Cash Debtors Stock Furniture 10,000 Capital Hamed 40,800 Mohsin 27,200 Saeed 20,000 Plant & Machinery 33,000 Investment 1,000 98,000 98,000 Fig2