Mita, Gopal and Farhan were partners sharing profits and losses in the ratio 3 : 2 : 1. On 31st March, 2018 they decided to change the profit sharing ratio to 5 : 3 : 2. On this date, the Balance Sheet showed Deferred Advertisement Expenditure ₹ 30,000 and Contingency Reserve ₹ 9,000.
Goodwill was valued at ₹ 4,80,000.
Pass the necessary Journal entries for the above transactions in the books of the firm on its reconstitution.
Solution:-
