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Ratio and Proportion

X and Y are...

Question

$X$ and $Y$ are partners in a firm sharing profits in the ratio of $3 : 2$ With effect fro, $1 s t$ April, $2018$ , they agreed to share profits equally. For this purpose, goodwill of the firm is valued at Rs. $75, 000$ . You are required to fill up the following Journal entry :
Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
2018
April
1
$Y^{'} s$ Capital A/c ...Dr
To $X^{'} s$ Capital A/c
(Being ?) ?
?

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Solution

Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
2018
April
1
Y′s Capital A/c ...Dr
To X′s Capital A/c
(Being goodwill shared by the partners in the sacrificing ratio)
7500
7500
workings:
X: 1/2 - 3/5 = (1/10) sacrificing ratio
Y : 1/2 - 2/5 = 1/10 (gaining rato)

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