Question

Gyanchand and govind are partners in a business sharing profit and losses in the ratio of 1/3 and 2/3 on 1st april 2017 their capitals are rs 40000 and rs 50000 respectively . On that date they admit gangaram in partnership and give him 1/4 share in future profit gangaram bring rs 40000 as his capital and rs 30000 as goodwill. The amount of goodwill is immediately withdrawn by the old partners in cash. Draft journal entries and show the capital account of all the partners as well as goodwill account . Calculate the proportion in which partners would share profit and losses in future.

Answer 1

new profit sharing ratio =1:2:1

sacrificing ratio of gyanchand and govind = 1:2