Illustration of change in profit sharing ratio, Financial Accounting

Illustration of change in profit sharing ratio

A, B and C have been trading as equal partners having capital contributions of £400,000, £300,000 and £200,000 respectively. They deaded to change their profit sharing ratio to 3:2:1. Goodwill was agreed at £150,000.

Required:

Prepare their capital accounts to show their new capital balances assuming that goodwill in not to be retained in the accounts.

Capital account

 

A

B

C

 

A

B

C

Goodwill

75,000

50,000

25,000

Bal. b/d

400,000

300,000

200,000

Bal. c/d

375,000

300,000

225,000

Goodwill

  50,000

  50,000

  50,000

 

450,000

350,000

250,000

 

450,000

350,000

250,000

Posted Date: 12/11/2012 6:08:35 AM | Location : United States







Related Discussions:- Illustration of change in profit sharing ratio, Assignment Help, Ask Question on Illustration of change in profit sharing ratio, Get Answer, Expert's Help, Illustration of change in profit sharing ratio Discussions

Write discussion on Illustration of change in profit sharing ratio
Your posts are moderated
Related Questions
The real risk-free rate is 2%. Inflation is expected to be 2% this year and 5% during the next 2 years. Suppose that the maturity risk premium is zero. What is the yield on 2-ye

Circumstances under which a subsidiary company can be excluded from consolidation Consolidated financial statements shall include all subsidiaries of the parent A parent need

Resolution For Voluntary Winding Up A company may be put into voluntary liquidation: 1) By ordinary resolution: where any period fixed for the duration of the company has ex

Q. Explain Final Location Survey? A final Location Survey is under taken on the completion of traffic survey to select the final rout of the line to be constructed, taking into

Hi, I want to join expert mind as an accounting and financial expert and earn some money herein, can you please let me know the procedure and other requirements. Rahul Jhunjhunwal

Q. Show the Management Report? Management's Report - Management is essential to include in its annual report its assessment of the effectiveness of the company's internal contr

Powers of trustee (A) Of his own initiative, he may: 1.    Sell and transfer any part of the bankrupt's property; 2.    Gives receipts for money received; 3.    Take all n

Q. Credit Reference Agencies and Credit Scoring ? A several organisations example Dun & Bradstreet and Standard & Poor provide credit scores and ratings for companies. These ma

A____ is a loss to the business and a gain to the debtor