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Zorluk: OrtaRevaluation of Assets and Liabilities

Ibrahim and Kemi are partners sharing profits and losses in the ratio 3:23:2. On 1st January 2026, they agreed to revalue their firm's assets and liabilities as follows:

- Building (book value ₦500,000\text{₦}500,000) revalued to ₦620,000\text{₦}620,000
- Furniture (book value ₦150,000\text{₦}150,000) revalued to ₦120,000\text{₦}120,000
- Provision for doubtful debts of 5%5\% created on trade debtors of ₦100,000\text{₦}100,000
- An unrecorded accrued electricity bill of ₦15,000\text{₦}15,000 recognized

What is the amount credited to Ibrahim's capital account as his share of the revaluation profit?

  1. ₦42,000\text{₦}42,000Cevap
  2. B
    ₦28,000\text{₦}28,000
  3. C
    ₦45,000\text{₦}45,000
  4. D
    ₦70,000\text{₦}70,000

Cevap

₦42,000\text{₦}42,000 is credited to Ibrahim's capital account as his share of revaluation profit.
Revaluation gain from Building appreciation is ₦120,000\text{₦}120,000. Revaluation losses comprise Furniture depreciation (₦30,000\text{₦}30,000), Provision for Doubtful Debts (₦5,000\text{₦}5,000), and unrecorded electricity liability (₦15,000\text{₦}15,000), totaling ₦50,000\text{₦}50,000. Subtracting total losses from total gain yields a net revaluation profit of ₦70,000\text{₦}70,000. Ibrahim's 3/53/5 share of this net profit equals ₦42,000\text{₦}42,000.

Adım Adım Çözüm

1
Calculate gains and losses on revaluation
Gain on Building = ₦620,000−₦500,000=₦120,000\text{₦}620,000 - \text{₦}500,000 = \text{₦}120,000. Loss on Furniture = ₦150,000−₦120,000=₦30,000\text{₦}150,000 - \text{₦}120,000 = \text{₦}30,000. Provision for Doubtful Debts = 5%×₦100,000=₦5,0005\% \times \text{₦}100,000 = \text{₦}5,000. Unrecorded Liability = ₦15,000\text{₦}15,000.
Increases in assets are gains (credited), while decreases in assets and increases in liabilities are losses (debited) in the Revaluation Account.
2
Determine the net revaluation profit
Total Revaluation Gain = ₦120,000\text{₦}120,000. Total Revaluation Loss = ₦30,000+₦5,000+₦15,000=₦50,000\text{₦}30,000 + \text{₦}5,000 + \text{₦}15,000 = \text{₦}50,000. Net Revaluation Profit = ₦120,000−₦50,000=₦70,000\text{₦}120,000 - \text{₦}50,000 = \text{₦}70,000.
Net revaluation profit equals total credits minus total debits in the Revaluation Account.
3
Allocate net revaluation profit to Ibrahim using the old profit-sharing ratio
Ibrahim's share = 33+2×₦70,000=35×₦70,000=₦42,000\frac{3}{3+2} \times \text{₦}70,000 = \frac{3}{5} \times \text{₦}70,000 = \text{₦}42,000.
Revaluation profit or loss belongs to existing partners in their agreed profit-sharing ratio.

Anahtar Kavram

Revaluation Account Profit Allocation
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Konular

Revaluation of Assets and Liabilities

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