Question

Aman, Govind and Guru shared profits 3 : 2 : 1. Sudarshan admitted for \( \frac{1}{4} \) share. New ratio = 9 : 5 : 4 : 6. Total capital of new firm = ₹ 3,60,000. Sudarshan brings \( \frac{1}{4} \) of total as capital. Capitals of Aman, Govind and Guru adjusted accordingly. New capitals of Aman, Govind and Guru were ₹ 60,000, ₹ 80,000 and ₹ 45,000 respectively. Calculate the new capitals and pass necessary journal entries.

Hint:

Calculate new capitals by multiplying new ratio × total capital, then adjust via cash brought in or withdrawn.

Answer 1

Sudarshan’s capital = ₹ 3,60,000 × 1/4 = ₹ 90,000

Remaining capital = ₹ 3,60,000 – ₹ 90,000 = ₹ 2,70,000

Divide ₹ 2,70,000 in ratio 9 : 5 : 4:
- Aman = (9/18) × ₹ 2,70,000 = ₹ 1,35,000
- Govind = (5/18) × ₹ 2,70,000 = ₹ 75,000
- Guru = (4/18) × ₹ 2,70,000 = ₹ 60,000

Adjustments:
- Aman brought in ₹ 75,000 more (already had ₹ 60,000)
- Govind withdrew ₹ 5,000 (already had ₹ 80,000)
- Guru brought in ₹ 15,000 more (already had ₹ 45,000)

Journal Entries:

Particulars	Dr. (₹)	Cr. (₹)
Bank A/c     To Sudarshan’s Capital A/c (Capital brought by Sudarshan)	90,000	90,000
Bank A/c     To Aman’s Capital A/c     To Guru’s Capital A/c (Cash brought in for capital adjustments)	90,000	75,000 15,000
Govind’s Capital A/c     To Bank A/c (Excess capital withdrawn by Govind)	5,000	5,000