Question

Purchased the running business of mukesh for rs. 500000 paid by proprietor with the following assets and liabilities ; machinery rs. 280000, furniture rs. 210000, creditors rs. 90000​

Answer 1

Explanation:

Machinery. 280000

Furniture. 210000

Goodwill. 100000

To Creditors 90000

To Cash 500000

Answer 2

Answer:

debit(in rs). credit (rs)

furniture A/c. Dr. 2,10,000

machinery a/c Dr. 2,80,000

goodwill a/c Dr. 1,00,000

to creditor a/c 90,000

to Mukesh 5,00,000

( being opening entry passed )

Explanation:

here 'goodwill' is a balancing figure .

extra amount paid is transferred to goodwill( reputation of business) and any profit transferred to capital reserve at the time of purchase of any business