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Question -

Leela and Meeta were partners in a firm sharing profits and losses in the ratio of 5:3. On Is Jan. 2017 they admitted Om as a new partner. On the date of Om’s admission the balance sheet of Leela and Meeta showed a balance of ₹ 16,000 in general reserve and ₹ 24,000 (Cr) in Profit and Loss Account. Record necessary journal entries for the treatment of these items on Om’s admission. The new profit sharing ratio between Leela, Meeta and Om was 5:3:2.



Answer -


Books of Leela, Meeta and Om

Journal

 

Date

Particulars

L.F.

Amount

₹

Amount

₹

2017

 

 

 

 

 

Jan 1

General Reserve A/c

Dr.

 

16,000

 

 

Profit and Loss A/c

Dr.

 

24,000

 

 

 

To Leela’s Capital A/c

 

 

 

25,000

 

 

To Meeta’s Capital A/c

 

 

 

15,000

 

(General reserve and balance in Profit and Loss credited to old

partners’ capital account in their old ratio, 5:3)

 

 

 

 

 

 

 

 

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