Nishu, Rishu and Kishu were partners in a firm sharing profits and losses in the ratio of 8: 7: 5. They decided to share future profits and losses in…

JOURNAL Date Particulars L.F. Dr. Cr. Amount ( ₹) Amount ( ₹) $\displaystyle 2024$ Rishu’s Capital A/c Dr. $\displaystyle 1,75,000$ April $\displaystyle 1$ Kishu’s Capital A/c Dr. $\displaystyle 3,50,000$ To Nishu’s Capital A/c $\displaystyle 5,25,000$ (adjustment entry due to change in profit sharing ratio) Working Notes Old Ratio = Nishu : Rishu : Kishu = $\displaystyle 8$:$\displaystyle 7$:$\displaystyle 5$ New Ratio = Nishu : Rishu : Kishu = $\displaystyle 5$:$\displaystyle 8$:$\displaystyle 7$ Sacrificing Share = Old Share – New Share Nishu’s Sacrificing Share = $\displaystyle 8$/$\displaystyle 20$ – $\displaystyle 5$/$\displaystyle 20$ = $\displaystyle 3$/$\displaystyle 20$ (sacrifice) Rishu’s Sacrificing Share = $\displaystyle 7$/$\displaystyle 20$ – $\displaystyle 8$/$\displaystyle 20$ = -$\displaystyle 1$/$\displaystyle 20$ (gain) Kishu’s Sacrificing Share = $\displaystyle 5$/$\displaystyle 20$ – $\displaystyle 7$/$\displaystyle 20$ = -$\displaystyle 2$/$\displaystyle 20$ (gain) Particulars ₹ General Reserve $\displaystyle 10,00,000$ Debit Balance of Profit and Loss Account ($\displaystyle 2,00,000$) Goodwill of the firm $\displaystyle 20,00,000$ Revaluation Profit $\displaystyle 7,00,000$ Total $\displaystyle 35,00,000$ Nishu Sacrifices = $\displaystyle 3$/$\displaystyle 20$ x $\displaystyle 35,00,000$ = ₹$\displaystyle 5,25,000$, Rishu Gains = $\displaystyle 1$/$\displaystyle 20$ x $\displaystyle 35,00,000$ = ₹$\displaystyle 1,75,000$ Kishu Gains = $\displaystyle 2$/$\displaystyle 20$ x $\displaystyle 35,00,000$ = ₹$\displaystyle 3,50$,000.