Question

A. B. and C are in partnership, sharing profits in the ratio of 2 : 2 : 1 It was provided in the
partnership agreement that on the death or retirement of a partner, goodwill should be
calculated on the basis of four years purchase of the aberage net profits for the preceding
seven years. C retires on 30th June, 2014 are : 2008 Rs 32000, 2009 Rs 40000, 2010 Rs
72000, 2011 Rs 64000, 2012 Rs 32000, 2013 Rs 80000 and 2014 Rs 72000
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Answer 1

Answer:

Old ratio (A, B and C) = 2 : 2 : 1

B's share = 2/5

B's sahre of goodwill = Rs. 60000 * (2/5) = 24000

Contribution to compensate B by:

A = 24000 * (2/3) = 16000

B = 24000 * (1/3) = 8000