Question

A and B are partners sharing profits in 3:2.They admit C into partnership for

¼ share and new ratio is agreed at3:3:2.Goodwill of the firm is agreed at

₹2,40,000. However, C is unable to bring his share of goodwill in cash. Entry for

adjustment of goodwill will be

C’s……………………..a/c Dr. ……………

To A’s Capital a/c. …….

To B’s Capital a/c. ……​

Answer 1

Answer:

C's capital a/c Dr. 60,000

to A's capital a/c. 54,000

to B's capital a/c. 6,000

Explanation:

sacrificing part of A = 3/5 - 3/8 = 9/40

sacrificing part of B = 2/5 - 3/8 = 1/40

sacrificing ratio of A and B = 9:1

C's share of Goodwill to be bought

= RS. 2,40,000 * 1/4

= RS. 60,000

this Goodwill to be bought by c will be distributed among A and B in their sacrificing ratio.

since he had not brought his share of Goodwill...the Goodwill amount to be paid by him will be taken from his capital account.

so,

C's capital a/c Dr. 60,000

to A's capital a/c. 54,000

to B's capital a/c. 6,000