Question :
R, B and L were partners in a firm sharing profits and losses in the ratio equally. With effect from 1st April, 2018 they decided to share future profits and losses in the ratio of 3:2:1. On that date their Balance Sheet showed a debit balance of Rs. 24,000 in Profit and Loss Account and a balance of Rs. 1,44,000 in General Reserve.
It was also agreed that:
(a) The goodwill of the firm be valued at Rs. 1,80,000.
(b) The Land (having book value of Rs. 3,00,000) will be valued at Rs. 4,80,000
Profit/Loss on revaluation are:
Option 1: Rs 1,40,000 profit
Option 2: Rs 1,80,000 profit
Option 3: Rs 1,80,000 loss
Option 4: None of the above
Correct Answer: Rs 1,80,000 profit
Solution : Answer = Rs 1,80,000 profit
Land A/c Dr 1,80,000
To Revaluation - 1,80,000
Revaluation A/c Dr 1,80,000
R's Capital A/c 60000
B's Capital A/c 60000
L's Capital A/c 60000
(old ratio 1:1:1)
Hence, the correct option is 2.
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