Samiksha, Ash and Divya were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. With effect from 1st April, 2019, they agreed to share future profits and losses in the ratio of 2 : 5 : 3. Their Balance Sheet showed a debit balance of Rs. 50,000 in the Profit and Loss Account and a balance of Rs. 40,000 in the Investment Fluctuation Fund. For this purpose, it was agreed that:

(i) Goodwill of the firm be valued at Rs. 3,00,000.

(ii) Investments of book value of Rs. 5,00,000 be valued at Rs. 4,80,000.

Pass the necessary journal entries to record the above transactions in the books of the firm.

Marks-4, CBSE:2019-20/Main/02/Q-15*

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