Solve this: ii) X, Y, and Z are partners in firm sharing profit and losses in the ratio of - Accountancy - Reconstitution- Change in Existing Profit Sharing Ratio

Question

Solve this:
ii) X, Y, and Z are partners in firm sharing profit and losses in
the ratio of 5 : 3 : 2 Y retires The following journal entry was
passed for goodwill The firm earned a profit of Rs 240000 in the
first year after Y's retirement Show the distribution
of profit between X and Z
Z's Capital A/c Dr 48000
To Y's capital A/c 36000
To X's capital A/c 12000
( Being effect of Goodwill given through capital accounts on Y's
retirement )

Neha Chopra · Accepted Answer

Dear Student,

Basis the Journal Entry given sacrificing ratio among Y & X
seems to be 310 & 110 (36,000:12,000) & Z's
gaining ratio = 410

Old ratio was 5:3:2, Y retires

so X's New Ratio = 510-110= 410
Z's New ratio = 210+410=610

So, New ratio is 4:6 or 2:3

Distribution of Profit after Y's retirement =

Date
Particulars

L F

Debit
Amount
(Rs)

Credit
Amount
(Rs)

Profit & Loss
Appropriation A/c

Dr

2,40,000

To X's Capital
A/c

96,000

To Z's Capital
A/c

1,44,000

(Profit distributed
amongâ€‹ X & Z)

Regards,

Date	Particulars		L.F.	Debit Amount (Rs)	Credit Amount (Rs)
	Profit & Loss Appropriation A/c	Dr.		2,40,000
	To X's Capital A/c				96,000
	To Z's Capital A/c				1,44,000
	(Profit distributed among X & Z)