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Partnership retirement

Accountancy

So here the financial year 2019-20 profits came out to be 48000. The partners were in ratio of 5:4:3 but after 1/4/19 they revised as 3:4:4. So the profits is transferred to old partners in ratio of 5:4:3 but for the period it is 3:4:4. So I didn't understand the logic behind it of sharing in 5:4:3 instead of 3:4:4?

Sugam SM

CA Final

★ 9K+

26-Apr-22 10:47

377

Answers (2)

Best Answer

Old PSR is 5:4:3 New PSR is 4:3:3(from 1/4/19) profit for the year 2019-20 is 48000 which was incorrectly distributed in PSR 5:4:3 After adjustment, it should be distributed in 4:3:3

Jitendra Kumar

CA Final

★ 41K+

26-Apr-22 11:52

Yep got it after reading further:).

Thread Starter

Sugam SM

CA Final

★ 9K+

26-Apr-22 11:57