Question

Jai and Raj are partners sharing profits in the ratio of 3 : 2 . With effect from 1st April, 2018, they decided to share profits equally. Goodwill appeared in the books at ₹ 25,000 . As on 1st April, 2018, it was valued at ₹ 1,00,000 . They decided to carry goodwill in the books of the firm.
Pass the journal entry giving effect to the above.

Answer 1

HEYA MATE YOUR ANSWER IS

interest is 15%. The net profits for the last 3 years were ₹ 30,000; ₹ 36,000 and ₹ 42,000. Goodwill is to be valued at 2 years purchase of the last 3 years super profits. Calculate the goodwill of the firm.

HOPE THIS HELPS ❤️

PLEASE MARK AS BRAINLIEST ❤️❤️

FOLLOW ME

Answer 2

Solution:

                                                  Journal

Particulars                                    Debit Amount (Rs.)     Credit Amount (Rs.) Raj's Capital A/c                      Dr.           7,500  

    To Jai's Capital A/c                                                                7,500  

(Being adjustment for goodwill)

Working Notes:

Calculation of Gaining/Sacrificing Ratio  Sacrificing Ratio

                                = Old Ratio - New Ratio

Jai = $\frac{3}{5} -\frac{1}{2}$ = $\frac{1}{10}$ (sacrifice) .

Raj = $\frac{2}{5} -\frac{1}{2}$ = $\frac{-1}{10}$ (Gain)

Goodwill to be adjusted = 1,00,000 — 25,000 = 75,000

Jai's share = 75,000 x $\frac{1}{10}$  = 7,500 (credit, since sacrificing)  

Raj's share = 75,000 x $\frac{1}{10}$ = 7,500  (debit , since sacrificing)