Question 14 Chapter 4 of +2-A - T.S. Grewal 12 Class Part

Question 14 Chapter 4 of +2-A

Table of Contents

The solution of Question 14 Chapter 4 of +2-A

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

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

14. A, B and C who are presently sharing profits and losses in the ratio of 5 : 3 : 2
decide to share future profits and losses in the ratio of 2 : 3 : 5. Give the Journal entry to distribute ‘Workmen Compensation Reserve’ of 1,20,000 at the time of change in profit-sharing ratio, when:

no information is given;
there is no claim against it.

The solution of Question 14 Chapter 4 of +2-A

Note: – in the both case there will be no pending claim against the workmen compensation reserve so the full amount will be distributed among the partners in the old profit sharing ratio.

In the Books of _______________
Date	Particulars		L.F.	Debit	Credit

	Workmen Compensation Reserve A/c	Dr		1,20,000
	To A’s Capital A/c				60,000
	To B’s Capital A/c				36,000
	To C’s Capital A/c				24,000
	(Being Adjustment for Workmen Compensation Reserve.)

Working Note :

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Amount to be Credited to A’s Capital	=	1,20,000	X	5
				10
	=	60,000

Amount to be Credited to B’s Capital	=	1,20,000	X	3
				10
	=	36,000

Amount to be Credited to C’s Capital	=	1,20,000	X	2
				10
	=	24,000

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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