Commerce Exam > Commerce Questions > X and y are partners in a firm sharing profit...
Start Learning for Free
X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same?
Most Upvoted Answer
X and y are partners in a firm sharing profits in the ratio of 1:1.on ...
Journal Entries for Admitting a New Partner Without Transferring General Reserve to Capital Accounts
When a new partner is admitted to a firm, the existing partners may decide to adjust their profit sharing ratio. In such cases, the general reserve may be transferred to the capital accounts of the partners. However, in some cases, the partners may prefer not to transfer the general reserve to the capital accounts and instead record an adjustment entry for the same. The following are the journal entries that need to be recorded in the books of the firm when a new partner is admitted without transferring the general reserve to the capital accounts:
1. Record the adjustment entry for the general reserve
General Reserve A/c Dr. 55,000
To X's Capital A/c 27,500
To Y's Capital A/c 27,500
Explanation: In this entry, the general reserve account is debited, and the capital accounts of the existing partners, X and Y, are credited in their old profit sharing ratio of 1:1. This entry ensures that the general reserve remains in the books of the firm and is not transferred to the capital accounts of the partners.
2. Record the entry for Z's capital contribution
Z's Capital A/c Dr. (amount of capital contributed)
To Bank A/c
Explanation: In this entry, Z's capital account is debited for the amount of capital contributed by him/her, and the bank account is credited.
3. Record the adjustment entry for the revaluation of assets and liabilities
Revaluation A/c Dr.
To X's Capital A/c (in the new ratio)
To Y's Capital A/c (in the new ratio)
To Z's Capital A/c (in the new ratio)
Explanation: In this entry, the revaluation account is debited, and the capital accounts of all the partners, X, Y, and Z, are credited in their new profit sharing ratio of 5:3:2. This entry is made to adjust the value of the assets and liabilities of the firm based on their fair market value and to bring them in line with the new profit sharing ratio.
In conclusion, the above journal entries need to be recorded in the books of the firm when a new partner is admitted without transferring the general reserve to the capital accounts. These entries ensure that the general reserve remains in the books of the firm and is not transferred to the capital accounts of the partners.
When a new partner is admitted to a firm, the existing partners may decide to adjust their profit sharing ratio. In such cases, the general reserve may be transferred to the capital accounts of the partners. However, in some cases, the partners may prefer not to transfer the general reserve to the capital accounts and instead record an adjustment entry for the same. The following are the journal entries that need to be recorded in the books of the firm when a new partner is admitted without transferring the general reserve to the capital accounts:
1. Record the adjustment entry for the general reserve
General Reserve A/c Dr. 55,000
To X's Capital A/c 27,500
To Y's Capital A/c 27,500
Explanation: In this entry, the general reserve account is debited, and the capital accounts of the existing partners, X and Y, are credited in their old profit sharing ratio of 1:1. This entry ensures that the general reserve remains in the books of the firm and is not transferred to the capital accounts of the partners.
2. Record the entry for Z's capital contribution
Z's Capital A/c Dr. (amount of capital contributed)
To Bank A/c
Explanation: In this entry, Z's capital account is debited for the amount of capital contributed by him/her, and the bank account is credited.
3. Record the adjustment entry for the revaluation of assets and liabilities
Revaluation A/c Dr.
To X's Capital A/c (in the new ratio)
To Y's Capital A/c (in the new ratio)
To Z's Capital A/c (in the new ratio)
Explanation: In this entry, the revaluation account is debited, and the capital accounts of all the partners, X, Y, and Z, are credited in their new profit sharing ratio of 5:3:2. This entry is made to adjust the value of the assets and liabilities of the firm based on their fair market value and to bring them in line with the new profit sharing ratio.
In conclusion, the above journal entries need to be recorded in the books of the firm when a new partner is admitted without transferring the general reserve to the capital accounts. These entries ensure that the general reserve remains in the books of the firm and is not transferred to the capital accounts of the partners.
Community Answer
X and y are partners in a firm sharing profits in the ratio of 1:1.on ...
No adjustment entry will be passed because of x will not sacrifice and total general reserve transfer into y a/c
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
|
Explore Courses for Commerce exam
|
|
Top Courses for CommerceView all
X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same?
Question Description
X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same?.
X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same?.
Solutions for X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? in English & in Hindi are available as part of our courses for Commerce.
Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? defined & explained in the simplest way possible. Besides giving the explanation of
X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same?, a detailed solution for X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? has been provided alongside types of X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? theory, EduRev gives you an
ample number of questions to practice X and y are partners in a firm sharing profits in the ratio of 1:1.on 31st march,2018 their balance sheet showed a general reserve of rs 55000.on that date they decided to admit z as a new partner and the new profit sharing ratio will be 5:3:2.record neccesary journal entries in the book of the firn when they do not want to transfer general reserve in their capital accounts but prefer to record an adjustment entry for the same? tests, examples and also practice Commerce tests.
|
|
Explore Courses for Commerce exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup