Deep, Ishwar, and Mukesh were partners in a firm sharing profits and losses in the ratio of 5:3:2. From 1st April,2020 they decided to share profits equally. The revaluation of assets and re-assessment of liabilities resulted in a profit of₹10000. The goodwill of the firm on its reconstitution was valued at₹120000. The firm had a balance of₹30000 in general reserve. Showing your working clearly,pass journal entries on the reconstitution of the firm.
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sacrifice or gain
old ratio - new ratio
Deep. == 5/10-1/3=5/30. (S)
Ishwar = 3/10- 1/3= 1/30( G)
Mukesh == 2/10-1/3=4/30(G)
profit on revaluation ==10000
Goodwill. =. 120000
General reserve = 30000
== 160000
Ishwar capital a/c. dr 5333
Mukesh capital a/ c. dr 21333
To. deep capital a/ c. 26666
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