# Question 7 Chapter 4 – Unimax Class 12 Part 1 – 2021

Question 7 Chapter 4 – Unimax Class 12 Part 1

7. X, Y and Z are partners in a firm sharing profits in 1 : 2 : 3. Their Balance Sheet as at 31.3.21, showed a Balance of Rs. 120000 in general Reserve. From 1.4.21 they will share profits equally. Pass the necessary Journal entry to give effect to the above arrangement when X, Y and Z decide not to close the general reserve account.

## The solution of Question 7 Chapter 4 – Unimax Class 12 Part 1:

 Old Share New Share Difference X            1/6 1/3 1/6_1/3=[1/6] (gain) Y            2/6 1/3 2/6_1/3=0 (No change) Z           3/6 1/3 3/6_1/3=[1/6] (loss)

X will pay to Z, 1/6 share of General Reserve ( i.e. 120000 x 1/6 = Rs. 20000)

Journal

 Date Particulars L.F. Debit Credit X’s Capital A/c Dr. 20,000 To Z’s Capital A/c 20,000 (Being adjustment entry Passed for share of General Reserve on change in profit sharing ratio)

What is Partnership – Meaning and its Types

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