X, Y and Z are partners sharing profits in the ratio of 5:3:2. They decide to share future profits in the ratio of 2:3:5 with effect from 1st April, 2018 . They also decide to record the effect of following revaluation without affecting the book values of assets and liabilities, by passing single adjusting entry :
Book Value (Rs.) | Revised Value (Rs.) | |
Land and Building | 3,00,000 | 4,50,000 |
Plant and Machinery | 4,50,000 | 4,20,000 |
Trade Creditors | 1,50,000 | 1,35,000 |
Outstanding Rent | 1,35,000 | 1,80,000 |