question_answer

X, Y and Z are partners sharing profits and losses in the ratio of 3 : 2 : 3. From 1st April, 2017, they decided to share profits in the ratio of 2 : 3 : 4. The goodwill of the firm was valued at Rs. 3,60,000. You are required to pass necessary journal entry.

Answer:

                                                                        JOURNAL

Date	Particulars		LF	Amt (Dr)	Amt (Cr)
2017
Apr 1	Y?s Capital A/c	Dr		30,000
	Z?s Capital A/c	Dr		25,000
	To X?s Capital A/c				55,000
	(Being adjustment of goodwill due to change in profit sharing ratio)

Working Note Old Ratio = 3 : 2 : 3; New Ratio = 2 : 3 : 4 Sacrificing Ratio = Old Share - New Share X\[=\,\frac{3}{8}\,-\,\frac{2}{9}\,=\,\frac{27-16}{72}\,=\,\frac{11}{72}\,Sacrifice;\]                     Y \[=\,\frac{2}{8}\,-\,\frac{3}{9}\,=\,\frac{18-24}{72}\,=\,\left( \frac{6}{72} \right)\,Gain;\] Z \[=\,\frac{3}{8}\,-\,\frac{4}{9}\,=\,\frac{27-32}{72}\,=\,\left( \frac{5}{72} \right)\,Gain\] X \[Sacrifice\,=\,3,60,000\times \frac{11}{72}\,=\,Rs.\,55,000\] Y \[Gain\,=\,3,60,000\times \frac{6}{72}\,=\,Rs.\,30,000\] Z Gain \[=\,3,60,000\times \frac{5}{72}\,=\,Rs.\,25,000\]