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Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio?
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Dhoni and pathan are patner in a form sharing profite in the ratio of ...
Journal Entry for Distribution of Balance in Profit and Loss Account and General Reserve
Before the Change in Profit Sharing Ratio:
- Credit Balance in Profit and Loss Account: Rs 50,000
- General Reserve: Rs 24,000
Step 1: Calculate the Total Available Amount for Distribution
- Total Available Amount: Rs 50,000 (Profit and Loss Account) + Rs 24,000 (General Reserve) = Rs 74,000
Step 2: Distribute the Amount According to Old Profit Sharing Ratio
- Dhoni's Share (5/8): Rs 46,250 (5/8 x Rs 74,000)
- Pathan's Share (3/8): Rs 27,750 (3/8 x Rs 74,000)
Step 3: Record Journal Entry for Distribution
- Dhoni's Capital Account Debit: Rs 46,250
- Pathan's Capital Account Debit: Rs 27,750
- Profit and Loss Account Credit: Rs 50,000
- General Reserve Credit: Rs 24,000
After the Change in Profit Sharing Ratio:
- New Profit Sharing Ratio: 3:5 (Pathan:Dhoni)
Step 1: Calculate the Sacrifice/Gain of Each Partner
- Pathan's Sacrifice: Rs 27,750 (Old Share) - Rs 18,000 (New Share) = Rs 9,750
- Dhoni's Gain: Rs 46,250 (Old Share) - Rs 56,000 (New Share) = Rs 9,750
Step 2: Record Journal Entry for Adjustment
- Dhoni's Capital Account Debit: Rs 9,750
- Pathan's Capital Account Credit: Rs 9,750
Explanation:
The given problem is about two partners, Dhoni and Pathan, who share profits in the ratio of 5:3. They decide to change their profit sharing ratio to 3:5. Before the change, the Profit and Loss Account showed a credit balance of Rs 50,000 and there was a General Reserve of Rs 24,000. The necessary journal entry needs to be recorded for the distribution of the balance in the Profit and Loss Account and General Reserve before the change in profit sharing ratio.
The first step is to calculate the total available amount for distribution, which is the sum of the credit balance in the Profit and Loss Account and the General Reserve. The next step is to distribute this amount according to the old profit sharing ratio. Dhoni's share is 5/8 of the total amount, while Pathan's share is 3/8 of the total amount.
The journal entry for distribution includes debiting Dhoni's and Pathan's Capital Accounts for their respective shares and crediting the Profit and Loss Account and General Reserve. This clears the balance in the Profit and Loss Account and adds it to the partners' Capital Accounts.
The second part of the problem involves adjusting the profit sharing ratio. The new ratio is 3:5, with Pathan getting a larger share than before. The sacrifice/gain of each partner is calculated by subtracting the new share from the old share. The journal entry for adjustment involves debiting Dhoni's Capital Account and crediting Pathan's Capital Account for the difference in their shares.
In conclusion, the problem emphasizes the importance of maintaining accurate records of profits and losses and the
Before the Change in Profit Sharing Ratio:
- Credit Balance in Profit and Loss Account: Rs 50,000
- General Reserve: Rs 24,000
Step 1: Calculate the Total Available Amount for Distribution
- Total Available Amount: Rs 50,000 (Profit and Loss Account) + Rs 24,000 (General Reserve) = Rs 74,000
Step 2: Distribute the Amount According to Old Profit Sharing Ratio
- Dhoni's Share (5/8): Rs 46,250 (5/8 x Rs 74,000)
- Pathan's Share (3/8): Rs 27,750 (3/8 x Rs 74,000)
Step 3: Record Journal Entry for Distribution
- Dhoni's Capital Account Debit: Rs 46,250
- Pathan's Capital Account Debit: Rs 27,750
- Profit and Loss Account Credit: Rs 50,000
- General Reserve Credit: Rs 24,000
After the Change in Profit Sharing Ratio:
- New Profit Sharing Ratio: 3:5 (Pathan:Dhoni)
Step 1: Calculate the Sacrifice/Gain of Each Partner
- Pathan's Sacrifice: Rs 27,750 (Old Share) - Rs 18,000 (New Share) = Rs 9,750
- Dhoni's Gain: Rs 46,250 (Old Share) - Rs 56,000 (New Share) = Rs 9,750
Step 2: Record Journal Entry for Adjustment
- Dhoni's Capital Account Debit: Rs 9,750
- Pathan's Capital Account Credit: Rs 9,750
Explanation:
The given problem is about two partners, Dhoni and Pathan, who share profits in the ratio of 5:3. They decide to change their profit sharing ratio to 3:5. Before the change, the Profit and Loss Account showed a credit balance of Rs 50,000 and there was a General Reserve of Rs 24,000. The necessary journal entry needs to be recorded for the distribution of the balance in the Profit and Loss Account and General Reserve before the change in profit sharing ratio.
The first step is to calculate the total available amount for distribution, which is the sum of the credit balance in the Profit and Loss Account and the General Reserve. The next step is to distribute this amount according to the old profit sharing ratio. Dhoni's share is 5/8 of the total amount, while Pathan's share is 3/8 of the total amount.
The journal entry for distribution includes debiting Dhoni's and Pathan's Capital Accounts for their respective shares and crediting the Profit and Loss Account and General Reserve. This clears the balance in the Profit and Loss Account and adds it to the partners' Capital Accounts.
The second part of the problem involves adjusting the profit sharing ratio. The new ratio is 3:5, with Pathan getting a larger share than before. The sacrifice/gain of each partner is calculated by subtracting the new share from the old share. The journal entry for adjustment involves debiting Dhoni's Capital Account and crediting Pathan's Capital Account for the difference in their shares.
In conclusion, the problem emphasizes the importance of maintaining accurate records of profits and losses and the
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Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio?
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Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio? 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 Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio? covers all topics & solutions for Class 12 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio?.
Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio? 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 Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio? covers all topics & solutions for Class 12 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio?.
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Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio?, a detailed solution for Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio? has been provided alongside types of Dhoni and pathan are patner in a form sharing profite in the ratio of 5:3 they decided to change their profit sharing ratio 3:5on the date of change in the profit sharing ratio profit andloss account showed a credit balance of rs 50000 and general reserved of rs 24000 record necessary journal entry for the disturbution of the balance in the profit and loss account and general reserve befor. The change in the profit sharing ratio? theory, EduRev gives you an
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