Question : X, Y and Z were partners in a firm sharing profis in 2:3:5 ratio. They decided to share the future profits in 5:3:2. For this purpose the goodwill of the firm was valued at 12,00,000. In adjustment entry for the treatment of goodwill due to change in the profit sharing ratio :
 

Option 1: Cr. X by Rs 240000; Dr. Y by Rs 240000

Option 2: Cr. X by Rs 600000; Dr. Z by Rs 600000
 

Option 3: Cr. X by Rs 360000; Dr. Z by Rs 360000

 

Option 4: Dr. X by Rs 360000; Cr. Z by Rs 360000


Team Careers360 12th Jan, 2024
Answer (1)
Team Careers360 18th Jan, 2024

Correct Answer: Dr. X by Rs 360000; Cr. Z by Rs 360000


Solution : Answer = Dr. X by Rs 360000; Cr. Z by Rs 360000

Sacrificing ratio = old ratio - new ratio

X = 2/10 - 5/10 = -3/10 x 12,00,000 = 3,60,000

Y = 3/10 - 3/10 = 0

Z = 5/10 - 2/10 = 3/10 x 12,00,000 = 3,60,000

X's Capital A/c Dr 3,60,000

To Z's Capital A/c 3,60,000
Hence, the correct option is 1.

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