Answer Happy

On 1 October 20x4 Pumbaa and Timon were admitted to the Hakuna
Matata partnership. The following terms and conditions relating to
the admission were agreed upon: 1. Statement of financial position
values after taking the above adjustments into account should be
used. 2. Simba would take over the only motor vehicle for his
personal use at its recoverable amount of N$90,000. 3. Puumba was
to bring into the partnership his motor vehicle valued at N$80,000,
as well as N$10,000 cash for a quarter share of the business. 4.
Timon was to bring into the partnership a cash contribution to
capital of N$45,000, for a one- eighth share of the business. 5.
Simba and Nala were to give up the profit share allocated to the
new partners according to their existing profit-sharing ratio. 4
YOU ARE REQUIRED TO: 1. Calculate the new profit sharing ratio of
the four partners after the admission of Pumbaa and Timon. (4
marks) 2. Prepare the capital account of the partnership (in
columnar form), taking all the above information into account. (21
marks)