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12th | Change in Profit Sharing Ratio Among the Existing Partner | Question No. 11 To 15 | Ts Grewal Solution 2023-2024

Question 11


 

Hari, Ram and Shyam who were sharing profits and losses in the ratio of 5:3: 2, decide to share future profits and losses in the ratio of 2:2:1. Goodwill of the firm is valued at 1,00,000. Goodwill existing in the books is 40,000.

Show the necessary accounting treatment by raising Goodwill Account.

 

Answer:


Journal

 

Date

Particulars

L.F.

Debit

   `

Credit

   `

 

 1.

Hari's Capital A/c

Dr.

 

20,000

 

 

 

Ram’s Capital A/c

Dr.

 

12,000

 

 

 

Shyam's Capital A/c

Dr.

 

8,000

 

 

 

 To Goodwill A/c

 

 

 

40,000

 

 

(Being Goodwill is written off)

 

 

 

 

 

 2. (a)

Goodwill A/c

Dr.

 

1,00,000

 

 

 

 To Hari's Capital A/c

 

 

 

50,000

 

 

 To Ram’s Capital A/c

 

 

 

30,000

 

 

 To Shyam's Capital A/c

 

 

20,000

 

 

(Being Goodwill is Raised to write off)

 

 

 

 

 

 

 

 

 

 

 

 (b)

Hari's Capital A/c

Dr.

 

40,000

 

 

 

Ram’s Capital A/c

Dr.

 

40,000

 

 

 

Shyam's Capital A/c

Dr.

 

20,000

 

 

 

 To Goodwill A/c

 

 

1,00,000

 

 

(Being Goodwill is written off)

 

 

 

 

 

 

 

 

 

 

 

 

Working Note;

 

Old Goodwill is written off as follow

Arun= 40.000×2/5 = 20,000

Varun= 40.000×2/5 = 12,000

Tarun= 40.000×1/5 = 8,000

 

 

1.  Valued Goodwill is raised to write off as follow

Arun= 1,00.000×5/10 =50,000

Varun=1,00.000×3/10=30,000

Tarun=1,00.000×2/10 =20,000

 

2. Valued Goodwill is written off as follow

Arun= 1,00.000×2/5 =40,000

Varun= 1,00.000×2/5 =40,000

Tarun= 1,00.000×1/5=20,000

 

Question 12:


 

. A, B and C shared profits and losses in the ratio of 3: 2:1 respectively. With effect from

1st April, 2023, they agreed to share profits equally. The goodwill of the firm was valued at 18,000.

Pass necessary Journal entries when:

(a) Goodwill is adjusted through Partners' Capital Accounts; and

(b) Goodwill is raised and written off.

Answer:


(a) Goodwill is adjusted through Partners' Capital Accounts;

 

Journal

Date

Particulars

L.F.

Debit

   `

Credit

   `

 1.

C's Capital A/c

Dr.

 

3,000

 

 

 To A's Capital A/c

 

 

 

3,000

 

(Being sacrificing partner compensated)

 

 

 

 

 

 

 

 

 

 

 

(b) Goodwill is raised and written off.

Journal

Date

Particulars

L.F.

Debit

   `

Credit

   `

 

Goodwill A/c

Dr.

 

18.000

 

 

    To A's Capital A/c

 

 

 

9,000

 

    To B’s Capital A/c

 

 

 

6,000

 

    To C's Capital A/c

 

 

 

3,000

 

(Being Goodwill is Raised)

 

 

 

 

 

A's Capital A/c

 

 

6,000

 

 

B’s Capital A/c

 

 

6,000

 

 

C's Capital A/c

 

 

6,000

 

 

    To Goodwill A/c

 

 

18.000

 

(Being Goodwill is written off)

 

 

 

 

 

 

 

 

 

 

 

Calculation of New Profit-sharing Ratio on the basis of Adjustment of Goodwill

 

Question 13:


 

. Naman, Aman and Raman are partners sharing profits and losses 2023, they decide to change the profit-sharing ratio. They pass the following adjustment entry for goodwill the ratio of 2:2: 1. From 1st April in the books:

Journal

Date

Particulars

L.F.

Debit

   `

Credit

   `

April 1 

Naman's Current A/c (Rs. 2,00,000×3/25)

Dr.

 

24,000

 

 

Raman's Current A/c (Rs. 2,00,000×2/25)

Dr.

 

16,000

 

 

To Aman's Current A/c (Rs. 2,00,000×5/25)

 

 

 

 

 

(Being goodwill adjusted on change in profit-sharing ratio)

 

 

 

40,000

 

 

 

 

 

What will be the new profit-sharing ratio of partners assuming capital of partners are fixed?

 

Answer:


Naman

= 2/5+3/25

 

= 10-3/25

 

= 13/25

 

 

Aman

= 2/5-5/25

 

= 10-5/25

 

= 5/25

 

 

Raman

= 1/5+2/25

 

= 5+2/25

= 7/25

 

Question 14:


Nitya and Anand are partners in a firm sharing profits and losses in the ratio of 3 : 2. With effect from 1st April, 2023, they decided to share future profits equally. On the date of change in the profit-sharing ratio, the Profit and Loss Account showed a credit balance of  ` 1,50,000. Record the necessary Journal entry for the distribution of the balance in the Profit and Loss Account immediately before the change in the profit-sharing ratio.  

Answer:


Journal

Date
 

Particulars

L.F.

Debit

 ( `)

Credit

 ( `)

2023
April 1


Profit & Loss A/c


Dr.

 


1,50,000

 

 

  To Nitya’s Capital A/c

 

 

 

90,000

 

  To Anand’s Capital A/c

 

 

 

60,000

 

(Being Adjustment of balance in P&L A/c in old ratio)

 

 

 

 

Working Notes:

WN1 Calculation of Share of Profit and Loss A/c

Nisha's share=1,50,000×3÷5=90,000

Anand's share=1,50,000×2÷5=60,000
 

Question 15:


Om and Shiv are partners in a firm sharing profits in the ratio of 4 : 1. They decided to share future profits in the ratio of 3 : 2 w.e.f1st April, 2023. On that day, Profit and Loss Account showed a debit balance of  ` 1,00,000. Pass Journal entry to give effect to the above.

Answer:


Journal

Date
 

Particulars

L.F.

Debit

 ( `)

Credit

 ( `)

2023

 

 

 

 

 

April 1

Om’s Capital A/c

Dr.

 

80,000

 

 

 Shiv’s Capital A/c

Dr.

 

20,000

 

 

    To Profit & Loss  A/c

 

 

 

1,00,000

 

(Being Profit & Loss  distributed)

 

 

 

 

 

 

 

 

 

 

 

Ts Grewal Solution 2023-2024

Click below for more Questions

Class 12 / Volume – I

Chapter 3 – Change in Profit-Sharing Ratio Among the Existing Partner

 

Question No. 1 To 5
Question No. 6 To 10
Question No. 11 To 15
Question No. 16 To 20
Question No. 21 To 25
Question No. 26 To 30

Question No. 31 To 33