Question

17. Amar, Bhuwan and Chaman were partners sharing profits and losses in the ratio of 3:2:1. Bhuwan died
on 30th June, 2020. Loss from the beginning of the accounting year till the date of death was estimated at
* 1,80,000. Amar and Chaman decided to share future profits in the ratio of 3:2 w.e.f. 1st April, 2020.
Pass the necessary Journal entry to record Bhuwan's share of profit/loss up to the date of death
18​

Answer 1

Explanation:

Bhuwan 'scapital a/c dr. 60000

To Amar's capital a/c 18000

To Chaman's capital a/c 42000

Answer 2

Answer:

Concept:

Journal Entries are the first step in accounting cycle. It is used to record all the business transactions.

Find:

Pass the necessary Journal entry to record Bhuwan's share of profit/loss up to the date of death

Given:

Amar, Bhuwan and Chaman were partners sharing profits and losses in the ratio of 3:2:1. Bhuwan died

on 30th June, 2020. Loss from the beginning of the accounting year till the date of death was estimated at

1,80,000. Amar and Chaman decided to share future profits in the ratio of 3:2 w.e.f. 1st April, 2020.

Explanation:

Journal entry-

Bhuwan 'scapital a/c ... dr. 60000

To Amar's capital a/c 18000

To Chaman's capital a/c 42000

(Being record Bhuwan's share of profit/loss up to the date of death)

Working Notes:

WN1: Calculation of Bhuwan's Share of Profit

Bhuwan's share= Firm's Loss x Bhuwan's Profit Share

$Bhuwan's \: share= 1,80,000 \times \frac{2}{6} =60,000$

to be borne by gaining partners in gaining ratio

WN2: Calculation of Gaining Ratio

Gaining Ratio = New Ratio - Old Ratio

$Amar's \: gain= \frac{3}{5} - \frac{3}{6}$

$= \frac{3}{30}$

chaman's gain=2/5-1/6

$chaman's \: gain= \frac{2}{5} - \frac{1}{6}$

$=\frac{7}{30}$

Gaining Ratio=3:7

$Amar's \: share=60,000 \times \frac{3}{10}$

$= 18000$

$chaman's \: share=60,000× \frac{7}{10}$

$= 42000$