Pass the Journal entry when a new partner fails to bring premium for Goodwill.
Answers
Answered by
2
Answer:
It can be done by various methods.
Method 1:
Transfer the goodwill amount to his Current Account. Say Rs 100 is to be brought by Mr C. And Mr A and Mr B are existing partners sharing profits equally
C's Current A/c Dr 100
To A's Capital a/c 50
To B's Capital A/c 50
Method 2:
Raise the goodwill in old ratio and write of the goodwill in new ratio(say good will is 120)
Raise 120 in 1:1
Goodwill a/c Dr 120
To A's Capital a/c 60
To B's Capital A/c 60
Write off 120 in 1:1:1
A's Capital ac Dr 40
B's Capital ac Dr 40
C's Capital ac Dr 40
To goodwill ac 120
Similar questions