in ques 83 a adj point is given i.e investment are valued at rs 10,000. X takes over investments at this value.
what does this mean ?
Dear Student,
Investments appears for Rs 8,000 in the Balance Sheet , whereas, in the adjustments it is provided at Rs 10,000 which means that there is an increase in the value of Investments by Rs 2,000 which is credited in the Revaluation Account.
Now after this it is specified that X takes over Investments at its book value which means that investment is taken over by X for Rs 10,000 and thus,Investments will no more belong to the firm and will not be shown in the new Balance Sheet. When Investments were taken over by X,then X's Capital Account is debited and Investment Account is credited as asset is decreasing.
Hope this answers your query.
For further doubts, do get back to us.
Keep Posting!!!
Investments appears for Rs 8,000 in the Balance Sheet , whereas, in the adjustments it is provided at Rs 10,000 which means that there is an increase in the value of Investments by Rs 2,000 which is credited in the Revaluation Account.
Now after this it is specified that X takes over Investments at its book value which means that investment is taken over by X for Rs 10,000 and thus,Investments will no more belong to the firm and will not be shown in the new Balance Sheet. When Investments were taken over by X,then X's Capital Account is debited and Investment Account is credited as asset is decreasing.
Hope this answers your query.
For further doubts, do get back to us.
Keep Posting!!!