Charu and Deepika were partners sharing profits in the ratio of 3 : 2. They admitted Esha, as a new partner and the new ratio is agreed at 4 : 3 : 2. On the date of Esha’s admission, the Balance Sheet of Charu and Deepika disclosed General Reserve ₹ 1,20,000

Charu and Deepika were partners sharing profits in the ratio of 3 : 2. They admitted Esha, as a new partner and the new ratio is agreed at 4 : 3 : 2. On the date of Esha’s admission, the Balance Sheet of Charu and Deepika disclosed General Reserve ₹ 1,20,000; Dr. balance in Profit & Loss Account ₹ 40,000; Investments ₹ 2,00,000 and Investment Fluctuation Reserve ₹ 60,000.

The following was agreed upon Eshas’ admission :

(i) Esha will bring ₹ 3,00,000 as her Capital and her share of goodwill premium in cash.

(ii) Goodwill of the firm be valued ₹ 1,80,000.

(iii) The market value of investments was ₹ 2,30,000.

Pass the necessary journal entries.