Question

Preet and Saral were partners sharing profits and losses in the ratio of 3 : 2. On 31^st March, 2024 they decided to change their profit sharing ratio to 1 : 1. On the date of reconstitution goodwill of the firm was valued at ₹ 1,00,000. The journal entry for treatment of goodwill on account of change in profit-sharing ratio will be: 

विकल्प

• Particulars	Dr. Amount (₹)	Cr. Amount (₹)
  Preet’s Capital A/c    ...Dr.	1,00,000	-
  To Saral’s Capital A/c	-	1,00,000

• Particulars	Dr. Amount (₹)	Cr. Amount (₹)
  Saral’s Capital A/c    ...Dr.	1,00,000	-
  To Preet’s Capital A/c	-	1,00,000

• Particulars	Dr. Amount (₹)	Cr. Amount (₹)
  Preet’s Capital A/c    ...Dr.	10,000	-
  To Saral’s Capital A/c	-	10,000

• Particulars	Dr. Amount (₹)	Cr. Amount (₹)
  Saral’s Capital A/c    ...Dr.	10,000	-
  To Preet’s Capital A/c	-	10,000

Answer 1

Particulars	Dr. Amount (₹)	Cr. Amount (₹)
Saral’s Capital A/c    ...Dr.	10,000	-
To Preet’s Capital A/c	-	10,000

Explanation:

Old Ratio = 3 : 2

New Ratio = 1 : 1

Preet’s Sacrifice/Gain = `3/5-1/2`

= `6/10-5/10` 

= `1/10`

Saral’s Sacrifice/Gain = `2/5-1/2`

= `4/10-5/10=1/10`

Saral will compensate ₹ 10,000 `(₹ 1,00,000xx1/10)` to Preet.