Q.No.21 | Chapter 4 – Change in Profit-Sharing Ratio Among the Exiting Partners | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1

The solution of Question 21 Chapter 4 of +2-A

In the Books of _______________

Date	Particulars		L.F.	Debit	Credit
2019
April 1	Z's Capital A/c*3	Dr		760
	To X's Capital A/c				760
	(Being profit on revaluation Adjusted through Capital account)

 

In the Books of _______________

Particulars	Amount
Increase in Investment	3,000 Cr.
Decrease in Plant and Machinery	5, 000 Dr.
Increase in Land and Building	10,000 Cr.
Increase in Outstanding Expenses	400 Dr.
Decrease in Sunday Debtors	10,000 Dr.
Decrease in Trade Creditors	10,000 Cr.
Profit on Revaluation	7,600

 

Working Note : 

WN *2 Calculation of Share of General Reserve –

Old Ratio of X, & Y	=	5 : 3 : 2
New Ratio of X, & Y	=	4 : 3 : 3

Calculate the Sacrificing or Gaining Ratio of Partners
Sacrificing or Gaining Ratio = Old Ratio - New Ratio

X’s Share Sacrificing/Gaining	=	5	-	4
		10		10

=	5- 4
		10

=	1	(Sacrificing)
			10

Y’s Share Sacrificing/Gaining	=	3	-	3
		10		10

=	3 -3
		10
=	Nil

Z’s Share Sacrificing/Gaining	=	2	-	3
		10		10

=	2- 3
		10

=	-1	(Gain)
			10

WN *3 Calculation of Adjustment of Revaluation Profit/Loss : -

Amount to be Credited to X's Capital	=	7,600	X	1
				10
	=	760

 

Amount to be Debited to Z's Capital	=	7,600	X	1
				10
	=	760

 

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

• Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
• Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
• Chapter No. 3 – Goodwill: Nature and Valuation
• Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
• Chapter No. 5 – Admission of a Partner
• Chapter No. 6 – Retirement/Death of a Partner
• Chapter No. 7 – Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 8 – Company Accounts –  Accounting for Share Capital
• Chapter No. 9 – Company Accounts – Issue of Debentures
• Chapter No. 10 – Redemption of Debentures

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 1 – Financial Statements of a Company
• Chapter No. 2 – Financial Statement Analysis 
• Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
• Chapter No. 4 – Accounting Ratios
• Chapter No. 5 – Cash Flow Statement

 

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