(Distribution of old reserves) A and B share profits in 5 : 3 ratio. On 31st March, 2018 they had 20,000 in general reserve and 8,000 in (Dr.) Profit & Loss Alc. The new ratio with effect from 1st April, 2018 will be 3 : 2. It was decided by partners that before bringing the new ratio into force the old profit (Dr.) and general reserve should be distributed. Journalise (Ans. A (Cr.) 7.500: B (Cr.) 4,500)
Answers
Answered by
0
Answer:
Explanation:
DISTRIBUTION OF PROFIT
===============================================================
BY GENERAL RESERVE 20,000.00
LESS LOSS (DR P&La/C 8,000.00
NET PROFIT AVAILABLE 12,000.00
TO A = 5/8 7,500.00
TO B = 3/8 4,500.00
==============================================================
TOTAL 12,000.00 12,000.00
==============================================================
NOTE:
OLD BALANCE OF PROFIT SHOULD BE DISTRIBUTED IN THE OLD PROFIT SHARING RATIO
Similar questions