kalpana and sunita are partners sharing profit in the ratio 1:1. They admitted Mona as a new partner for 1/5 th share in profit and she brought rs. 25000 for her share of goodwill. Find total Goodwill of the firm.
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Answer:
kalpana and sunita are partners sharing profit in the ratio 1:1. They admitted Mona as a new partner for 1/5 th share in profit and she brought rs. 25000 for her share of goodwill. Find total Goodwill of the firm.
GIVEN : Mona is admitted to partnership with 1/5 th share ; she brings her share of goodwill that is 25,000
TO FIND : Total goodwill of the firm
SOLUTION :
To find goodwill of the firm we will multiply the share of goodwill bought by new partner with the reciprocal of his/ her profit sharing ratio and will get the firms goodwill.
Goodwill of the firm = Mona share of goodwill × Reciprocal of her profit sharing ratio
Goodwill of the firm = 25,000 × 5
Goodwill of the firm = 1,25,000
So, goodwill of the firm is rupees 1,25,000.
Goodwill of the firm is 1,25,000 .