Priya commenced business with a capital rs 200000
Answers
Answer:
Capital as on April,1 2013
Less: Loss on 31st March, 2014
Add: Profit on 31st March, 2015
Add: Profit on 31st March, 2016
Add: Profit on 31st March, 2017
Add: Profit on 31st March, 2018
250000
(5000)
13000
17000
20000
25000
Less: Drawings 320000
(40000)
Capital as on March 31st, 2018 280000
Calculation of Goodwill:
Average profit= [-5000+13000+17000+20000+25000]/5
= 14000
Goodwill= 14000 * 3
= 42000
B's share of Goodwill= 42000 * 1/2= 21000
B's Capital= A's Capital= 280000
JOURNAL
1. Cash a/c..... Dr. 301000
To B's Capital a/c 280000
To Premium for Goodwill a/c 21000
(Being capital and premium for goodwill brought in by B)
2. Premium for Goodwill a/c... Dr. 21000
To A's Capital a/c 21000
(Being premium for goodwill transferred to A's Capital account)
Explanation:
hope it helps you
Answer:
capital A/C ....Dr
to Priya A/c.
debit amount 2,00,000
credit amount 2,00,000