se A/c (Dr.)
ect of Reserves
ertisement Sus
ution of Sacrifice
eserve
ss A/e
ܠܐ ܝ. ܀
Multiple Choice Questions
MCQ.39
22. Amar and Akbar are partners sharing profits in the ratio of 3: 2. They changed their profit-sharing ratio
to 2:3 w.e.f. 1st April, 2021. The Balance Sheet as on the date of change in profit-sharing ratio showed
credit balance in Profit and Loss Account of 1,00,000, which the partners decide to carry forward and not
distribute. The balance of 1,00,000 will be adjusted by
a Crediting Amar's Capital Account and Debiting Akbar's Capital Account by 1,00,000.
b Crediting Amar's Capital Account and Debiting Akbar's Capital Account by 20,000.
© Debiting Amar's Capital Account and Crediting Akbar's Capital Account by 1,00,000.
Debiting Amar's Capital Account and Crediting Akbar's Capital Account by 320,000.
3. Nasim and Parvez are partners sharing profits equally. They changed their profit-sharing ratio to 2:3 w.e.f.
1st April, 2021. The assets were revalued, and liabilities were reassessed on that date which resulted in a
loss of 80,000. It will be transferred to their Capital Accounts by
a Debiting Nasim's Capital Account and Parvez's Capital Account by 3 40,000 each.
b Debiting Nasim's Capital Account and Parvez's Capital Account by 80,000 each.
Crediting Nasim's Capital Account and Parvez's Capital Account by 40,000 each.
pital
and Parvez's Capital Account by 80.000 each.
Answers
(1) (b) Crediting Amar's capital account and debiting Akbar's capital account by 20,000.
Given the old profit sharing ratio of Amar and Akbar is 3:2. The new profit sharing ratio is 2:3. We need to adjust the profit of ₹1,00,000 to their capital accounts.
Total net profit = ₹1,00,000. share in profits:-
1) as per old ratio (3:2) = Aman Akbar
1,00,000 * 3/5 = 60,000 1,00,000 * 2/5 = 40,000
2) as per new ratio (2:3) =
1,00,000 * 2/5 = 40,000 1,00,000 * 3/5 =60,000
Sacrifice of Amar = 60,000 - 40,000 = (20,000)
gain of Akbar = 60,000 - 40,000 = 20,000
so, entry will be:-
Akbar's capital a/c dr. 20,000
to Amar's capital a/c 20,000
( being adjustment for profit made )
(2) (a) Debiting Nasim's capital account and Parvez's capital account by ₹40,000 each.
Given the old profit sharing ratio of Nasim and Parvez is equal. The new profit sharing ratio is 2:3. Total loss is ₹80,000 which will be transferred to their capital accounts in their old profit sharing ratio (1:1).
Nasim's share in loss = 80,000 * 1/2 = 40,000
Parvez's share in loss = 80,000 * 1/2 = 40,000
so entry will be:-
Nasim's capital a/c dr. 40,000
Parvez's capital a/c dr. 40,000
to loss on revaluation a/c 80,000
( being loss transferred to Nasim and Parvez's capital accounts. )