Question - 37

Sita, Reeta and Geeta are partners in a firm sharing profit and losses in the ratio of 4:3:1 As per the firm of partnership deed. on the death of any partne goodwill was to be valued at 50% of the net profits credited to that partners capital accunt during the last three completed year before her death sita died on 28 feb., 2015 the profit for the last five years were 2010 - Rs. 60,000, 2011 Rs. - 97,000, 2012 - Rs. 1,05,000, 2013 - Rs. 30,000 and 2014 - Rs. 84,000. 

On the date of sita's death building was found undervalued by Rs. 80,000, which was to be considered calculate amount of sita's share of goodwill in the firm and record the adjustment journal entries of goodwill and revaluation of building the new profit sharing ratio between Reeta and Geeta will be equal.

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