C and D are partner in a firm sharing profits in the ratio of 4:1. On 31.3.2016 their Balance Sheet was as follows:
On the above date, E was admitted 1/4 th share in the profits of the following terms:
(i) E will bring 1,00,000 as his capital and 20,000 for his share of goodwill premium half of which will be withdrawn by C and D.
(ii) Debtors 2,000 will be written off as bad debts and a provision of 4% will be created on debtors for bad debts and doubtful debts.
(iii) Stock will be reduced by ₹2,000, furniture will be depreciated by ₹4,000 and 10% depreciation will be charged on plant and machinery.
(iv) Investments of 7,000 not shown in the Balance Sheet will be taken into account.
(v) There was an outstanding repairs bill of ₹ 2,300 which will be recorded in the books.
Pass necessary Journal entries for the above transactions in the books of the firm on E's admission.