Ram, Mohan and Sohan are partners in a firm sharing profits in the ratio 3:2:1. With effect from April 1, 2007 they decided to share profits equally as Sohan brings in additional capital.
This is an example of ______________.

Retirement of an existing partner

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Death of a partner

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Change in the profit sharing ratio among the existing partner

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Admission of a new partner

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Solution

The correct option is C Change in the profit sharing ratio among the existing partner
Change in the profit sharing ratio among the partners is one of the mode of reconstitution of partnership firm. Sometimes the partners of a firm may decide to change their existing profit sharing ratio. For example, Ram, Mohan and Sohan are partners in a firm sharing profits in the ratio of 3:2:1. With effect from April 1, 2007, they decided to share profits equally as Sohan brings in additional capital. This results in change in the existing agreement leading to reconstitution of the firm.

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Similar questions

Q. Ram, Mohan and Sohan were partners in a firm sharing profits in the ratio of

5 : 3 : 2

. They admitted Hari as a new partner for

{\frac{1}{5}}^{t h}

share in the profit which he a acquired from Ram and Mohan in the ratio of

3 : 2

. Calculate, the new profit sharing ratio of Ram, Mohan, Sohan and Hari.

Q. From the following particulars, calculate new profit-sharing ratio of the partners:
(a) Shiv, Mohan and Hari were partners in a firm sharing profits in the ratio of 5 : 5 : 4. Mohan retired and his share was divided equally between Shiv and Hari.
(b) P, Q and R were partners sharing profits in the ratio of 5 : 4 : 1. P retires from the firm.

Q. Ram, Mohan, Sohan and Hari were partners in a firm sharing profits in the ratio of 4 : 3 : 2 : 1. On 1st April, 2016, their Balance Sheet was as follows:

BALANCE SHEET OF RAM, MOHAN, SOHAN AND HARI as on 1st April, 2016
Liabilities		₹	Assets	₹
Capital A/cs:			Fixed Assets	9,00,000
Ram	4,00,000		Current Assets	5,20,000
Mohan	4,50,000
Sohan	2,50,000
Hari	2,00,000	13,00,000
Workmen Compensation Reserve		1,20,000



		14,20,000		14,20,000

From the above date, the partners decided to share the future profits in the ratio of 1 : 2 : 3 : 4. For this purpose the goodwill of the firm was valued at ₹ 1,80,000. The partners also agreed for the following:(a) The Claim for workmen compensation has been estimated at ₹ 1,50,000.
(b) Adjust the capitals of the partners according to the new profit-sharing ratio by opening Partners' Current Accounts.
Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet of the reconstituted firm.

Q. For the following particulars, calculate new profit-sharing of the partners.
(a) Shiv, Mohan and Hari were partners in a firm sharing profits in the ratio of

5 : 5 : 4

. Mohan retired and his share was divided equally between Shiv and Hari.
(b)

P, Q

and

R

were partners sharing profit in the ratio of

5 : 4 : 1

P

retires from the firm.

Ram and Mohan were partners in a firm sharing profits in the ratio of 4:1. On 1-3-2015, they admitted Sohan as a new partner for $\frac{1}{3} r d$ share in the profits of the firm. They fixed the new profit sharing ratio as 4:2:3.

The P & L A/c on the date of admission showed a Balance of Rs 32,000 (Dr.) The firm also had a reserve of Rs 1,00,000. Sohan is to bring Rs 60,000 as premium for his share of goodwill.

Showing your calculations clearly, pass necessary journal entries to record the above transactions.

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Ram, Mohan and Sohan are partners in a firm sharing profits in the ratio 3:2:1. With effect from April 1, 2007 they decided to share profits equally as Sohan brings in additional capital.This is an example of ______________.

Ram, Mohan and Sohan are partners in a firm sharing profits in the ratio 3:2:1. With effect from April 1, 2007 they decided to share profits equally as Sohan brings in additional capital.
This is an example of ______________.