A, B and C were partners sharing profits and losses in the ratio of 6:31. They...

 

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A, B and C were partners sharing profits and losses in the ratio of 6:31. They decide to take D into partnership with effect from 1* April, 2018. The new profit-sharing ratio between A, B, C and D will be 3: 3:31. They also decided to record the effect of the following without affecting their book values, by passing a single adjustment entry: Book Value (Rs.)p Pass the necessary single General Reserve 1,50,000 Contingency Reserve 60,000 Profit and Loss A/c(Cr.) 90,000 Advertisement Suspense A/c (Dr.)1,20,000 adjustment entry, through the partner's Current Account. A, B and C were partners sharing profits and losses in the ratio of 6:31. They decide to take D into partnership with effect from 1* April, 2018. The new profit-sharing ratio between A, B, C and D will be 3: 3:31. They also decided to record the effect of the following without affecting their book values, by passing a single adjustment entry: Book Value (Rs.)p Pass the necessary single General Reserve 1,50,000 Contingency Reserve 60,000 Profit and Loss A/c(Cr.) 90,000 Advertisement Suspense A/c (Dr.)1,20,000 adjustment entry, through the partner's Current Account.

Answer rating: 100% (QA)

JOURNAL 1 General reserve ac Dr 150000 Contingency reserve ac D... View the full answer