A,B and C are partner sharing profit in the ratio of 50% 30% and 20% B retire and after all adjustment relating to accumulated profit goodwill and revolution etc. Their capital stood at 190000, 150000 and 80000 respectively. It was decided that entire sum payable to B is to be brought in by A and C in such a way so at to make Thier capital proportion to Thier profit sharing ratio. Calculate the amount to be brought in by Aand C and pass entire for the same. Also pass entry relating to payment to B.
Answers
Answer:
cash brought by parents
A = 1,10,000
B= 40,000
Explanation:
calculations of firm's capital
A 1,90,000
B 1,50,000
C. 80,000
firm capital = 4,20,000
old ratio 5:3:2
new ratio after B retirement 5:2
A capital = 4,20,000 × 5/7 = 3,00,000
B Capital = 4,20,000 × 2/7 = 1,20,000
cash brought by parents
A = 3,00,000 - 1,90,000 = 1,10,000
B = 1,20,000 - 80,000 = 40,000
Answer:
cash brought by folks
A = 1,10,000
B= 40,000
Explanation:
Calculations of the firm's capital
A 1,90,000
B 1,50,000
C. 80,000
Firm capital = four,20,000
Profit sharing of A, B, C= 5:3:2
After B's retirement the profit= 5:2
Capital of A = 4,20,000 × 5/7 = 3,00,000
Capital of B = 4,20,000 × 2/7 = 1,20,000
cash brought by folks
The capital difference of A = 3,00,000 1,90,000 = 1,10,000
The capital difference of B = 1,20,000 - 80,000 = 40,000
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