Question : A, B and C are partners in a firm sharing profits in the ratio of equally They decided to share profits 4:3:1 w.e.f. 1st April, 2019. On that date the Profit and Loss Account showed the credit balance of Rs 48,000. Instead of closing the Profit and Loss Account, it was decided to record an adjustment entry reflecting the change in profit sharing ratio. In the journal entry :
Option 1: Dr. A by Rs 2000; Dr. B by Rs 8000; Cr. C by Rs 10,000
Option 2: Cr. A by Rs 2000; Cr. B by Rs 8,000; Dr. C by Rs10,000
Option 3: Cr. A by Rs 8,000; Cr. B by Rs 2000; Dr. C by Rs10,000
Option 4: Dr. A by Rs 8,000; Dr. B by Rs 2,000; Cr. C by Rs10000
Correct Answer: Dr. A by Rs 8,000; Dr. B by Rs 2,000; Cr. C by Rs10000
Solution : Answer = Dr. A by Rs 8,000; Dr. B by Rs 2,000; Cr. C by Rs10000
Sacrificing ratio = O.R. - N.R.
A = 1/3 - 4/8 = 8-12/24 = -4/24 x 48000 = 8000
B = 1/3 - 3/8 = 8-9/24 = -1/24 x 48000 =2000
C = 1/3 - 1/8 = 8-3/24 = 5/24 x 48000 = 10,000
A's Capital A/c Dr 8000
B's Capital A/c Dr 2000
To C's Capital A/c - 10,000 Hence, the correct option is 4.
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