Milton and Dilton are partners in a firm sharing profits and losses in the ratio 3: 2. On 1st April, 2019, they admitted Garvi as a partner to the firm for 1/3rd share. She brought 2,00,000 as capital and 20,000 as her share of goodwill premium. The Balance Sheet of Milton and Dilton as on 1st April, 2019, was as follows:

It was agreed that: 1. Value of Plant and machinery will be appreciated by 10% 2. Value of Furniture to be depreciated by 20% 3. Capitals of Milton and Dilton to be adjusted on the basis of Garvis capital. Any adjustment is to be done by opening the partners current account.

Prepare Revaluation Account, Partners Capital Account and balance sheet of the new firm.

Amount Balance Sheet of Milton and Dilton As at 19 April, 2019 Amount Liabilities () Assets Capitals: Plant and Machinery Milton 5,00,000 Furniture Dilton 4,00,000 9,00,000 Debtors 1,20,000 Reserve Fund 1,20,000 Less: Provision 20,000 Taxation Reserve 80,000 Stock Creditors 2,00,000 Cash 3,50,000 4,50,000 1,00,000 2,50,000 1,50,000 13,00,000 13,00,000