The firm of Harry, Potter and Ali, who have been sharing profits in the ratio of...
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The firm of Harry, Potter and Ali, who have been sharing profits in the ratio of 2:2: 1, have existed for same years. Ali wants that he should get equal share in the profits with Harry and Potter and he further wishes that the change in the profit-sharing ratio should come into effect retrospectively were for the three years. Harry and Potter have agreement on this account. The profits for the last three years were: Year 2015-16, 2016-17 & 2017-18 Profit Rs. 2,20,000 2,40,000 2,90,000. Show adjustment of profits by means of a single adjustment Journal entry. The firm of Harry, Potter and Ali, who have been sharing profits in the ratio of 2:2: 1, have existed for same years. Ali wants that he should get equal share in the profits with Harry and Potter and he further wishes that the change in the profit-sharing ratio should come into effect retrospectively were for the three years. Harry and Potter have agreement on this account. The profits for the last three years were: Year 2015-16, 2016-17 & 2017-18 Profit Rs. 2,20,000 2,40,000 2,90,000. Show adjustment of profits by means of a single adjustment Journal entry.
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Harry Potter Ali Profit in old profit sharing ratio 300000 300000 150000 Profit in equal profit s... View the full answer
Related Book For
South Western Federal Taxation 2016 Corporations Partnerships Estates and Trusts
ISBN: 9781305399884
39th edition
Authors: James Boyd, William Hoffman, Raabe, David Maloney, Young
Posted Date:
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