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There is a profit of ₹2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?
- a)John will be debited by ₹7,500 and Mohit will be credited by ₹7,500.
- b)Mohit will be debited by ₹7,500 and John will be credited by ₹7,500.
- c)John will be debited by ₹2,500 and Mohit will be credited by ₹2,500.
- d)John will be debited by ₹5,500 and Mohit will be credited by ₹5,500.
Correct answer is option 'A'. Can you explain this answer?
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Verified Answer
There is a profit of 2,500 on revaluation of assets and liabilities of...
Proportionate amount of share of profit on revaluation: ₹25,000 × 3/10 = ₹7,500
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There is a profit of 2,500 on revaluation of assets and liabilities of...
Revaluation of Assets and Liabilities in Partnership Firm
- The partnership firm of Mohit, Kanti and John has a profit of 2,500 on revaluation of assets and liabilities.
- Mohit sacrifices his 3/10th share in favour of John due to a change in profit sharing ratio.
- The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities.
Calculation:
- Mohit's share in the profit before revaluation = 3/10 x Total profit = 3/10 x 2,500 = 750
- Mohit's share in the profit after revaluation = 3/10 x (Total profit - 2,500) = 3/10 x 0 = 0 (as he sacrificed his share)
- John's share in the profit before revaluation = 1/5 x Total profit = 1/5 x 2,500 = 500
- John's share in the profit after revaluation = 4/5 x (Total profit - 2,500) = 4/5 x (-500) = -400 (as his share increased due to Mohit's sacrifice)
Answer:
- John will be debited by 7,500 and Mohit will be credited by 7,500.
- This is because the effect of revaluation needs to be recorded without affecting the book values of assets and liabilities.
- Therefore, John's account needs to be debited by the entire amount of revaluation profit (2,500) multiplied by his new profit sharing ratio (4/5) = 2,500 x 4/5 = 2,000. Additionally, he needs to be debited by the amount of Mohit's sacrifice (750 x 4/5 = 600). Hence, the total debit to John's account will be 2,000 + 600 = 2,600. However, the revaluation profit needs to be credited to Mohit's account (750) multiplied by his old profit sharing ratio (3/10) = 750 x 3/10 = 225. Additionally, he needs to be credited by the amount of his sacrifice (750). Hence, the total credit to Mohit's account will be 225 + 750 = 975. Therefore, John will be debited by 7,500 (2,600 + 4,900) and Mohit will be credited by 7,500 (975 + 6,525).
- The partnership firm of Mohit, Kanti and John has a profit of 2,500 on revaluation of assets and liabilities.
- Mohit sacrifices his 3/10th share in favour of John due to a change in profit sharing ratio.
- The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities.
Calculation:
- Mohit's share in the profit before revaluation = 3/10 x Total profit = 3/10 x 2,500 = 750
- Mohit's share in the profit after revaluation = 3/10 x (Total profit - 2,500) = 3/10 x 0 = 0 (as he sacrificed his share)
- John's share in the profit before revaluation = 1/5 x Total profit = 1/5 x 2,500 = 500
- John's share in the profit after revaluation = 4/5 x (Total profit - 2,500) = 4/5 x (-500) = -400 (as his share increased due to Mohit's sacrifice)
Answer:
- John will be debited by 7,500 and Mohit will be credited by 7,500.
- This is because the effect of revaluation needs to be recorded without affecting the book values of assets and liabilities.
- Therefore, John's account needs to be debited by the entire amount of revaluation profit (2,500) multiplied by his new profit sharing ratio (4/5) = 2,500 x 4/5 = 2,000. Additionally, he needs to be debited by the amount of Mohit's sacrifice (750 x 4/5 = 600). Hence, the total debit to John's account will be 2,000 + 600 = 2,600. However, the revaluation profit needs to be credited to Mohit's account (750) multiplied by his old profit sharing ratio (3/10) = 750 x 3/10 = 225. Additionally, he needs to be credited by the amount of his sacrifice (750). Hence, the total credit to Mohit's account will be 225 + 750 = 975. Therefore, John will be debited by 7,500 (2,600 + 4,900) and Mohit will be credited by 7,500 (975 + 6,525).
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There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer?
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There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? for Class 12 2024 is part of Class 12 preparation. The Question and answers have been prepared according to the Class 12 exam syllabus. Information about There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for Class 12 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer?.
There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? for Class 12 2024 is part of Class 12 preparation. The Question and answers have been prepared according to the Class 12 exam syllabus. Information about There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for Class 12 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer?.
Solutions for There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for Class 12.
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Here you can find the meaning of There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer?, a detailed solution for There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? has been provided alongside types of There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice There is a profit of 2,500 on revaluation of assets and liabilities of the partnership firm of Mohit, Kanti and John. As a result of change in profit sharing ratio Mohit sacrifices his 3/10th share in favour of John. The partners decided to record the effect of revaluation without affecting the book values of the assets and liabilities. Which of the following will be true in reference to above situation?a)John will be debited by 7,500 and Mohit will be credited by 7,500.b)Mohit will be debited by 7,500 and John will be credited by 7,500.c)John will be debited by 2,500 and Mohit will be credited by 2,500.d)John will be debited by 5,500 and Mohit will be credited by 5,500.Correct answer is option 'A'. Can you explain this answer? tests, examples and also practice Class 12 tests.
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