Change in the profit-sharing ratio among the partners –
The existing partners may agree to share profits and losses in a ratio that is different from the earlier agreed profit-sharing ratio. As a result of change in the profit-sharing ratio among partners, the firm is reconstituted.
Adjustment for Change in Profit-Sharing Ratio:-
I. Determination of Sacrificing Ratio and Gaining Ratio
II. Accounting of Goodwill
III. Accounting of Reserve, Accumulated Profit and Losses
IV. Revaluation of Assets and Reassessment of Liabilities
V. Adjustment of Capital
practical problem solution ts grewal 2024 edition 1 to 29