I am working in an organization dealing with investment in different units. The profit earned from investment is distributed and paid to partners every year. We had purchased some units 10 years ago the dividend of which is received every year. Now after 10 years the market price of the units has raised to three times of the purchased value.
Now we intend to sale the units due to which we will receive an amount about 3 times more than the
original purchased value appearing in books.
I need guidance as to how to book the difference of amount (Existing Market Price - Origional Purchased value) and whether this difference will be treated as current year's profit or need to be spread over years as crediting the same to current year's profit and loss A/C will abnormally increase members share of profit.
will wait for an early response...
Now we intend to sale the units due to which we will receive an amount about 3 times more than the
original purchased value appearing in books.
I need guidance as to how to book the difference of amount (Existing Market Price - Origional Purchased value) and whether this difference will be treated as current year's profit or need to be spread over years as crediting the same to current year's profit and loss A/C will abnormally increase members share of profit.
will wait for an early response...