A and B are partners sharing profits and losses in the ratio 4:1. They admit C into partnership for 1/6th share for which he pays rs.20000 for goodwill. A,B and C decide to share profits in the ratio 3:2:1
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Total value of goodwill as per C's share = Rs.30000 * (3/1) = Rs.90000
Old ratio (A and B) = 4 : 1
New ratio (A, B and C) = 1 : 1 : 1
(Gaining) / Sacrificing ratio = Old ratio - New ratio
A's sacrifice = (4/5) - (1/3) = 7/15
B's sacrifice = (1/5) - (1/3) = -2/15 (Gain)
Therefore, amount of goodwill credited to A's account in sacrificing ratio
= Rs. 90000 * (7/15) = Rs. 42000
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