Calculate the profit/loss on revaluation of the partnership firm from the following information.

A company has the balances in the Balance Sheet are as follows-
Furniture- ₹1,00,000
Building - ₹5,00,000
Machinery - ₹2,00,000

At the time of retirement, these assets were revalued as follows-
Furniture increased by 15%, Building increased to ₹6,00,000, and Machinery decreased by ₹40,000.

₹50,000 Profit

The correct answer is option 4- ₹50,000 Profit.

* Furniture- ₹1,00,000
It is increased by 15%.
Increase = 1,00,000 x 15/100
               = 15,000

* Building - ₹5,00,00. It is increased to ₹6,00,000
Increase = 6,00,000 - 5,00,000
               = 1,00,000

* Machinery = ₹2,00,000 
Decrease = 40,000

"Credited to Revaluation A/C i.e. increase in assets"-
Furniture - ₹15,000
Building - ₹1,00,000

"Debited to Revaluation A/C i.e. decrease in assets"-
Machinery - 40,000

Profit on Revaluation = (1,00,000 + 15,000 - 40,000)
                                  = 75,000