Mahnad and Said are partners sharing profits in the ratio of 2:1. Ali is admitted in to the firm for share of profits. Ali brings OMR 15,000 in respect of his capital. The capitals of old partners Mahnad and Said after all adjustments relating to goodwill, revaluation of assets and liabilities etc. are OMR 40,000 and OMR 10,000 respectively. It is agreed that partners capitals should be according to the new profit sharing ratio.

You are required to prepare;

1. Calculate the new capitals of Mahnad and Said. (3 marks)
2. Prepare adjusting journal entries (2 marks)