Question

Reya, Mona and Nisha shared profits in the ratio of 3: 2: 1. The profits for the last three years were 1.40, 000: Rs.84,000 and Rs.1.06.000 respectively. These profits were by mistake shared equally for all the three years. It is now decided to correct the error. Give necessary Journal entry for the same.

Answer 1

Working Note:

Total profits for last 3 years.

= 1,40,000+84,000,1,06,000

=3,30,000.