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Give the journal entry to distribute investment fluctuation reserve of rupees 4000 at the time of retirement of z when investment market value rupees 19000 appears at rupees 20000 the firm has three partners X y and z?
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Give the journal entry to distribute investment fluctuation reserve of...
Journal Entry to Distribute Investment Fluctuation Reserve
Background: The firm has three partners X, Y, and Z. At the time of Z's retirement, the investment market value was Rs. 19,000, and it increased to Rs. 20,000.
Step 1: Calculation of Investment Fluctuation Reserve
- Investment Fluctuation Reserve = Market Value of Investment - Cost of Investment
- IFR = Rs. 19,000 - Cost of Investment
Step 2: Calculation of Z's Share in Investment Fluctuation Reserve
- Z's Share in IFR = (IFR/Total Investment) * Z's Capital
- Z's Share in IFR = (Rs. 4,000/ Rs. 19,000) * Z's Capital
Step 3: Distribution of IFR among Partners
- Debit Investment Fluctuation Reserve Account with Rs. 4,000
- Credit Z's Capital Account with Z's Share in IFR
- Credit X's Capital Account with (1/3) * (Rs. 4,000 - Z's Share in IFR)
- Credit Y's Capital Account with (1/3) * (Rs. 4,000 - Z's Share in IFR)
Explanation: When Z retired, the Investment Fluctuation Reserve was calculated as Rs. 4,000. Z's share in the IFR was calculated based on his capital contribution. The IFR was distributed among partners by debiting the IFR account and crediting the respective partners' capital accounts. X and Y's share in the IFR was calculated as 1/3 of the remaining amount after deducting Z's share.
Background: The firm has three partners X, Y, and Z. At the time of Z's retirement, the investment market value was Rs. 19,000, and it increased to Rs. 20,000.
Step 1: Calculation of Investment Fluctuation Reserve
- Investment Fluctuation Reserve = Market Value of Investment - Cost of Investment
- IFR = Rs. 19,000 - Cost of Investment
Step 2: Calculation of Z's Share in Investment Fluctuation Reserve
- Z's Share in IFR = (IFR/Total Investment) * Z's Capital
- Z's Share in IFR = (Rs. 4,000/ Rs. 19,000) * Z's Capital
Step 3: Distribution of IFR among Partners
- Debit Investment Fluctuation Reserve Account with Rs. 4,000
- Credit Z's Capital Account with Z's Share in IFR
- Credit X's Capital Account with (1/3) * (Rs. 4,000 - Z's Share in IFR)
- Credit Y's Capital Account with (1/3) * (Rs. 4,000 - Z's Share in IFR)
Explanation: When Z retired, the Investment Fluctuation Reserve was calculated as Rs. 4,000. Z's share in the IFR was calculated based on his capital contribution. The IFR was distributed among partners by debiting the IFR account and crediting the respective partners' capital accounts. X and Y's share in the IFR was calculated as 1/3 of the remaining amount after deducting Z's share.
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Give the journal entry to distribute investment fluctuation reserve of rupees 4000 at the time of retirement of z when investment market value rupees 19000 appears at rupees 20000 the firm has three partners X y and z?
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Give the journal entry to distribute investment fluctuation reserve of rupees 4000 at the time of retirement of z when investment market value rupees 19000 appears at rupees 20000 the firm has three partners X y and z? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Give the journal entry to distribute investment fluctuation reserve of rupees 4000 at the time of retirement of z when investment market value rupees 19000 appears at rupees 20000 the firm has three partners X y and z? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Give the journal entry to distribute investment fluctuation reserve of rupees 4000 at the time of retirement of z when investment market value rupees 19000 appears at rupees 20000 the firm has three partners X y and z?.
Give the journal entry to distribute investment fluctuation reserve of rupees 4000 at the time of retirement of z when investment market value rupees 19000 appears at rupees 20000 the firm has three partners X y and z? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Give the journal entry to distribute investment fluctuation reserve of rupees 4000 at the time of retirement of z when investment market value rupees 19000 appears at rupees 20000 the firm has three partners X y and z? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Give the journal entry to distribute investment fluctuation reserve of rupees 4000 at the time of retirement of z when investment market value rupees 19000 appears at rupees 20000 the firm has three partners X y and z?.
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