Partnership accounts

Others 192 views 4 replies
In case of preparing memorandum revaluation account ... why we are dividing the profit in to new PSR
Replies (4)

Because we wanted to understand the fair value of net assets of the firm & wanted to estimate the profit portion which needs to be paid by the new partner to existing partners.

 

Thank You sir 😊

But still i have some doubts regarding this

what is the reason behind the payment of profit by the new partner?

New partner wanted to join in a partnership & share the future profits of the firm. Then new partner needs to pay full consideration for the efforts taken by the old partners for the development of firm up to that level. So that's the reason why the new partner is making payment to old partners.

For example, Land purchased by old partners @ 1,00,000 in 1898

As on the date, the land value will be 10,00,000. The profit will be 9,00,000. If any person wanted to join the firm then he needs to pay his share of profit to new partners so that he will obtain the share in the land as per the profit sharing ratio.

 

Thank you so much sir 😊


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
Featured 14 March 2026
Associate CA

N N V Satish&co

Hyderabad

CA

View Details
Company
Featured 28 March 2026
Accountant

Ashok Amol & Associates

New Delhi

B.Com

View Details
Company
Featured 28 March 2026
CA Final

Ashok Amol & Associates

New Delhi

CA Final

View Details
Company
Featured 12 March 2026
Customer Relationship Executive

TAXLET

Calicut

B.Com

View Details
Company
Featured 13 April 2026
GST CONSULTANCY

Abhishek G Agrawal & Co.

Korba

CA Final

View Details
Company
Featured 19 March 2026
Article Assistant

Gupta Sachdeva & Co. Chartered Accountants

New Delhi

CA Final

View Details
Company
Featured 14 March 2026
Article Trainee

N N V Satish&co

Hyderabad

CA Inter

View Details
Company
Featured 14 April 2026
GST CONSULTANT

Abhishek G Agrawal & Co.

Korba

CA Final

View Details