Podcast
Questions and Answers
When partner C retired from ABC, how did A and B divide his share?
When partner C retired from ABC, how did A and B divide his share?
What was the new profit-sharing ratio between A and B after C's retirement in the ABC scenario?
What was the new profit-sharing ratio between A and B after C's retirement in the ABC scenario?
In the PQR situation, what was the original profit-sharing ratio between P, Q, and R?
In the PQR situation, what was the original profit-sharing ratio between P, Q, and R?
When R retired from PQR, how was his share divided between P and Q?
When R retired from PQR, how was his share divided between P and Q?
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How was the new profit-sharing ratio between Kavi, Ravi, and Kumar established after Guru's retirement?
How was the new profit-sharing ratio between Kavi, Ravi, and Kumar established after Guru's retirement?
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What is emphasized in distinguishing workman's compensation reserve from general reserve?
What is emphasized in distinguishing workman's compensation reserve from general reserve?
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Study Notes
- Today's video will cover retirement questions related to ratios, goodwill, and reserves.
- ABC had 3 partners with a ratio of 5:4:3, and when partner C retired, A and B took his share in a 3:2 ratio.
- PQR had partners sharing profits in a 3:4:1 ratio, and when R retired, 1/3 of his share went to P and the rest to Q, resulting in a new ratio of 5:7.
- A, B, C were partners sharing profits in a 7:15, 1:3, 1:5 ratio; when C retired, his share was taken by A and B in a 3:2 ratio.
- A, B, C had profit-sharing ratios of 3:2:1, with existing goodwill of 240,000; when B retired, new profit-sharing between A and C was set at 3:2, resulting in a gaining ratio of 3:7.
- Kavi, Ravi, Kumar, Guru were partners in a firm with a profit-sharing ratio of 3:2:2:1; when Guru retired, the new ratio between Kavi, Ravi, and Kumar was established.- Entry of goodwill needs to be passed again in the homework, removing the gaining ratio by subtracting new ratio from old ratio.
- Entry for gaining to sacrificing involves multiplying the firm's goodwill and passing the entry accordingly.
- The importance of distinguishing between workman's compensation reserve (employee's money) and general reserve is emphasized.
- Balances like P&L's debit balance and workman's compensation reserve are distributed to partners in specific ratios as per the given information.
- General reserve distribution involves putting 25% into provision for doubtful debts and distributing the rest among partners.
- Employee's provident fund is not to be distributed as it belongs to the employees, not the partners.
- In retirement scenarios, partners' profits and losses are shared in old ratios when a partner retires, and adjustments are made for reserves like workman's compensation reserve and investment fluctuation reserve.
- Detailed calculations are provided for distributing reserves and handling losses in various scenarios based on the given information.
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Description
This quiz covers retirement scenarios involving partners with different profit-sharing ratios, adjustments for reserves like workman's compensation reserve and general reserve, and the redistribution of balances such as P&L's debit balance. Detailed calculations are provided for handling losses and distributing reserves in various retirement situations.
