Question 17 Chapter 4 of +2 Part-1 – USHA Publication 12 Class Part – 1

Question 17 Chapter 4 of +2- Part-

Question 17 Chapter 4 of +2-Part-1

17. (Comprehensive Illustration) X,Y and Z are sharing profits and losses in 5:3:2 ratio. They agreed to share profits and losses in the ratio of 2:3:5 with effect from 1st April 2019. They also decide to record the effect of the following accumulated profits, losses and reserves without effecting their book figures by passing a single entry.

  Book figures (in Rs.)
General Reserve 6,000
Profit & Loss account 24,000
Advertisement Suspense account 12,000

Pass the necessary single adjustment entry.

 

 

The solution of Question 17 Chapter 4 of +2 Part-1: – 

 

In the Books of _______________
Date Particulars
L.F. Debit Credit
           
  Z’s Capital A/c Dr.   5,400  
  To X’s Capital A/c       5,400
  (Being profits adjusted on account of change in profit ratio)      
         

 

Working Notes: –

Old Ratio = 5 : 3 : 2
New Ratio = 2 : 3 : 5
Calculate the Sacrificing or Gaining Ratio of Partners
Sacrificing or Gaining Ratio = Old ratio – New ratio

 

X’s Share Sacrificing/Gaining = 5 2
10 10
  = 5- 2
  10
  = 3 (Sacrificing)
  10

 

 

Y’s Share Sacrificing/Gaining = 3 3
10 10
  = 3 – 3
  10
  = 0 (Nil)
  10

 

Z’s Share Sacrificing/Gaining = 2 5
10 10
  = 2 – 5
  10
  = -3 (Gaining)
  10

 

Calculation of total adjustment profit
Particulars
Amount
     
General Reserve   6,000
Profit & Loss account (Profit)    24,000
Advertisement Suspense account (-)12,000
Total adjustment profit 18,000

 

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Also, Check out the solved question of previous Chapters: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I

Chapter No. 3 – Partnership Accounts – II (Introduction)

Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)

Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)

Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Chapter No. 1 – Financial Statements of a Company (Balance Sheet Only)

Chapter No. 2 – Techniques of Financial Statement Analysis

Chapter No. 3 – Ratio Analysis 

Chapter No. 4 – Cash Flow Statement

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

2 Book 1 min - Question 17 Chapter 4 of +2 Part-1 - USHA Publication  12 Class Part - 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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