Question

P, T and R were partners in a firm sharing profits in the ratio 5:3:2 respectively. Their capitals were Rs 5,00,000, Rs 6,00,000 and Rs 7,00,000 respectively. In which ratio they ll divide the investment fluctuation reserve Rs 120000, if they decided to change their ratio as 1:2:3. Also give necessary journal entry​

Answer 1

Answer:

If they want to distribute the reserve they divide I their old ratio

Journal entry

Investment fluctuation reserve dr 120000

To P'capital account. 60000

To T'capital account. 36000

To R'capital account. 24000