Pinky, Qumar and Roopa partners in a firm sharing profits and losses in the ratio of 3:2:1. S is admitted as a new partner for 1/4 share in the profits of the firm, whichs he gets 1/8 from Pinky, and 1/16 each from Qmar and Roopa. The total capital of the new firm after Seema’s admission will be Rs 2,40,000. Seema is required to bring in cash equal to 1/4 of the total capital of the new firm. The capitals of the old partners also have to be adjusted in proportion of their profit sharing ratio. The capitals of Pinky, Qumar and Roopa after all adjustments in respect of goodwill and revaluation of assets and liabilities have been made are Pinky Rs 80,000, Qumar Rs 30,000 and Roopa Rs 20,000. Calculate the capitals of all the partners and record the necessary journal entries for doing adjustments in respect of capitals according to the agreement between the partners?
Answers
Given : Pinky, Qumar and Roopa partners in a firm sharing profits and losses in the ratio of 3:2:1.
Seema is admitted as a new partner for 1/4 share in the profits of the firm, whichs he gets 1/8 from Pinky, and 1/16 each from Qmar and Roopa. The total capital of the new firm after Seema’s admission will be Rs 2,40,000. Seema is required to bring in cash equal to 1/4 of the total capital of the new firm. The capitals of the old partners also have to be adjusted in proportion of their profit sharing ratio. The capitals of Pinky, Qumar and Roopa after all adjustments in respect of goodwill and revaluation of assets and liabilities have been made are Pinky Rs 80,000, Qumar Rs 30,000 and Roopa Rs 20,000.
Solution :
Necessary journal entries for doing adjustments in respect of capitals according to the agreement between the partners is in the attachment below :
Calculation :
Old ratio of old partners = Pinky : Qumar : Roopa = 3 : 2 : 1
Seema is admitted as new partner for ¼ share in profits.
She acquire from Pinky = ⅛ , Qumar = 1/16 , Roopa = 1/16
Pinky's new share = 3/6 - ⅛ = 18/48
Qumar's new share = 2/6 - 1/16 = 13/48
Roopa's new share = ⅙ - 1/16 = 5/48
Seema's share = ¼ = 12/48
New profit share = 18/48 : 13/48 : 5/48 : 12/48
New ratio = 18 : 13 : 5 : 12
Total capital of the new firm = 2,40,000
Share of capital of all partner in new sharing ratio :
Pinky's capital = 2,40,000 × 18/48 = 90,000
Qumar's capital = 2,40,000 × 13/48 = 65,000
Roopa's capital = 2,40,000 × 5/48 = 25,000
Seema's capital = 2,40,000 × 12/48 = 60,000
Capitals of old partners after adjustment :
Pinky's capital = 80,000
Pinky's share of capital according to new profit sharing ratio = 90,000
Pinky will brought in as additional capital = 90, 000 - 80,000 = 10,000
Qumar's capital = 30,000
Qumar's share of capital according to new profit sharing ratio = 65,000
Qumar will brought in as additional capital = 65, 000 - 30,000 = 35,000
Roopa's capital = 20,000
Roopa's share of capital according to new profit sharing ratio = 25,000
Roopa will brought in as additional capital = 255, 000 - 20,000 = 5,000
Seema will bring 60,000 as her share of capital.
Hope this answer will help you….
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Answer:
Pinky, Qumar and Roopa partners in a firm sharing profits and losses in the ratio of 3:2:1. S is admitted as a new partner for 1/4 share in the profits of the firm, whichs he gets 1/8 from Pinky, and 1/16 each from Qmar and Roopa. The total capital of the new firm after Seema’s admission will be Rs 2,40,000. Seema is required to bring in cash equal to 1/4 of the total capital of the new firm. The capitals of the old partners also have to be adjusted in proportion of their profit sharing ratio. The capitals of Pinky, Qumar and Roopa after all adjustments in respect of goodwill and revaluation of assets and liabilities have been made are Pinky Rs 80,000, Qumar Rs 30,000 and Roopa Rs 20,000. Calculate the capitals of all the partners and record the necessary journal entries for doing adjustments in respect of capitals according to the agreement between the partners?