# Question 33 Chapter 3 of Class 12 Part – 1 VK Publication

Question 33 Chapter 3 of Class 12 Part - 1 VK Publication

Question 33 Chapter 3 of Class 12 Part – 1

33. P and Q were partners in a firm sharing profits in the ratio of 3:1. With effect from 1st April,2017, they agreed to share profits in the ratio of 2:1. For this purpose, the Goodwill of the firm was valued at Rs. 50,000. General Reserves appear in the books at Rs. 40,000. Partner’s neither want to show goodwill in the books nor want to distribute the reserves. You are required to record the change by passing a single journal entry.

## The solution of Question 33 Chapter 3 of Class 12 Part – 1: –

Journal Entry

 Date Particulars L . F Dr. ₹ Cr. ₹ 2017 Q’s Capital A/c Dr. 7,500 April 1 To P’s Capital A/c 7,500 ( Being proportionate share of Goodwill and General Reserve adjusted between partners)

Working Note:

 Particulars P Q Partners’ Old Ratio 2/4 1/4 Partners’ New Ratio 2/3 1/3 Difference 1/12 (-1)/12 Net Effect Sacrifice Gain

Amount to be Adjusted:

 Goodwill = Rs. 50,000 General Reserve = Rs. 40,000 Rs. 90,000

Amount of compensation= 90,000 x 1/12 = Rs. 7,500

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