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State the ratio in which the partners share profits or losses on revaluation of assets and liabilities, when there is a change in profit sharing ratio amongst existing partners?

The profit and loss on revaluation of assets and liabilities will be shared in the old profit and loss ratio by the partners.

X, Y and Z are partners sharing profits in the ratio of 1/2, 2/5, 1/10. Find the new ratio of remaining partners if Z retires.

Old profit sharing ratio =1/2, 2/5, 1/10 =5:4:1 (by taking 10 as LCM)
As Z retires, the new profit sharing ratio will be 5: 4.

Mohan and Mahesh were partners in a firm sharing profits in the ratio of 3:2. On 1st April, 2012 they admitted Nusrat as a partner in the firm. The Balance Sheet of Mohan and Mahesh on that date was as under:

It was agreed that:
(i) The value of Building and Stock be appreciated to Rs 3,80,000 and Rs 1,60,000 respectively.
(ii) The liabilities of workmen's compensation fund was determined at Rs 2,30,000.
(iii) Nusrat brought in her share of goodwill Rs 1,00,000 in cash.
(iv) Nusrat was to bring further cash as would make her capital equal to 20% of the combined capital of Mohan and Mahesh after above revaluation and adjustments are carried out.
(v) The future profit sharing ratio will be Mohan 2 / 5, Mahesh 2/5, Nusrat 1/5.

Prepare Revaluation Account, Partner's Capital Accounts and Balance Sheet of the new firm. Also show clearly the calculation of Capital brought by Nusrat.

Working Notes:
Nusrat’s Capital = (Mohan’s capital + Mahesh’s capital) x 20/100

= (3,92,000 + 2,08,000) x 20/100

= 6,00,000 x 20 /100 = 1,20,000
Cash in Hand = 1,40,000+1,20,000+1,00,000 = 3,60,000

Kushal Kumar and Kavita were partners in a firm sharing profits in the ratio of 3:1:1. On 1st April, 2012 their Balance Sheet was as follows:

On the above date Kavita retired and the following was agreed:
(i) Goodwill of the firm was valued at Rs 40,000.
(ii) Land was to be appreciated by 30% and building was to be depreciated by Rs 1,00,000.
(iii) Value of furniture was to be reduced by Rs 20,000.
(iv) Bad debts reserve is to be increased to Rs 15,000.
(v) 10% of the amount payable to Kavita was paid in cash and the balance was transferred to her Loan Account.
(vi) Capitals of Kushal and Kumar will be in proportion to their new profit sharing ratio. The surplus/deficit, if any in their Capital Accounts will be adjusted through Current Accounts.

Prepare Revaluation Account, Partner's Capital Accounts and Balance Sheet of Kushal and Kumar after Kavita's retirement.

Working Notes:
Capital of Kushal before adjustment =     Rs 3,63,000
Capital of Kumar before adjustment =     Rs 3,01,000
Total capital                                   =     Rs  6,64,000
Kushal’s adjusted capital= ¾ * Rs 6,64,000 = Rs 4,98,000
Kumar’s adjusted capital= ¼ * Rs 6,64,000 = Rs 1,66,000

Saloni and Shrishti were partners in a firm sharing profits in the ratio of 7:3. Their capitals were Rs 2,00,000 and Rs 1,50,000 respectively. They admitted Aditi on 1st April, 2013 as a new partner for 1/6 share in future profits. Aditi brought Rs 1,00,000 as her capital. Calculate the value of goodwill of the firm and record necessary journal entries for the above transaction on Aditi's admission.

Aditi is admitted for 1/6th  share of profit, for capital amounting to Rs 100000.
Capitalized value of firm on the basis of Aditi’s capital = 100000*6/1=600000.
Actual capital = 200000+150000+100000=450000.
Value of goodwill = 600000-450000= 150000.
Aditi’s share in goodwill = 1/6th of 1,50,000 = Rs 25,000
The journal entries are as follows: