Illustration of change in profit sharing ratio, Financial Accounting

Assignment Help:

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

Related Discussions:- Illustration of change in profit sharing ratio

Dissolution-liquidation of companies, Dissolution If the winding up con...

Dissolution If the winding up continues for more than a year, the liquidator must file progress reports with the registrar at such intervals as the court may prescribe s.333. W

Describe the effects of each transaction on assets, KAM Computer Timeshare ...

KAM Computer Timeshare Company entered into the following transactions durnig May 2014 Decribe the effects of each transaction on assets, liabilities, and owner's equity. 1. Purcha

Bottomline Consulting, I am in a class that is supposed to be 100 level and...

I am in a class that is supposed to be 100 level and I am really struggling. I need hlep with trial balances, adjustments, etc.

How much of the existing cash balance, As of January 1, 2011, the partnersh...

As of January 1, 2011, the partnership of Canton, Yulls, and Garr had the following account balances and percentages for the sharing of profits and losses: Cash 80,000 non cash

Income statements, how to solve the question income statements

how to solve the question income statements

How many units must the division sell each year, unit selling price of prod...

unit selling price of products= $40 unit variable expense of product= $24 Total fixed expenses= 560,000 avg op assets= 3,000,000 1)how many units must the division sell each yea

Internal revenue service (irs), Explain:- Q.1 Explain the ways in which...

Explain:- Q.1 Explain the ways in which the needs of internal and external users of accounting information are the same and different. Q.2 Why is it important for financial sta

What are junk bonds, Q. What are Junk Bonds? Junk Bonds - DEBT SECURITI...

Q. What are Junk Bonds? Junk Bonds - DEBT SECURITIES issued by companies with higher than normal credit risk. Considered ‘non-investment grade' bonds, these SECURITIES ordinari

Enumerate the characteristics of accounting information, Enumerate the char...

Enumerate the characteristics of accounting information Qualities, or characteristics, which have just been depicted would help us to decide whether accounting information is p

Report on the management of foreign trade risks, Q. Report on the managemen...

Q. Report on the management of foreign trade risks? Your company is probable to face three types of risk in connection with its foreign trade. These are as: (1) Foreign exch

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages