Question

33. A and R are partners with respective capital of * 1,50,000 and 1,30,000, C comes as 1 a new partner for --th share and contribute 5 1,20,000 as his capital and necessary amount for his share of goodwill in cash. The goodwill brought by C will be: (a) 40,000 (b) 50,000 (c) 1,00,000 (d) 80,000
solve pls​

Answer 1

Correct question:

A and R are partners in a firm with capitals Rs 1,50,000 and Rs 1,30,000 respectively. C is admitted into the firm for 1/5th share in profits and contributes Rs 1,20,000 and the necessary amount as goodwill in cash. The goodwill brought in by C will be:

(a) Rs 40,000

(b) Rs 50,000

(c) Rs 1,00,000

(d) Rs 80,000

Answer:

This is a situation of hidden goodwill.

Total capital of the new firm = Capital of the new partner × The reciprocal of the new partner's share

• Capital of the new partner = Rs 1,20,000
• Reciprocal of the new partner's share = 5/1

Total capital of the new firm = Rs 1,20,000 × 5/1 = Rs 6,00,000

Firm's goodwill = Total capital of the new firm - Total capital of all the partners

• Total capital of the new firm = Rs 6,00,000
• Total capital of all the partners = Rs 1,50,000 + Rs 1,30,000 + Rs 1,20,000 = Rs 4,00,000

Firm's goodwill = Rs 6,00,000 - Rs 4,00,000 = Rs 2,00,000

C's share in goodwill = Firm's goodwill × C's share

• Firm's goodwill = Rs 2,00,000
• C's share = 1/5

C's share in goodwill = Rs 2,00,000 × 1/5 = Rs 40,000

Therefore, the goodwill that is brought in by C is (a) Rs 40,000.