Question

Q. 70. The Balance Sheet of A and B carrying on business in partnership and
sharing profits in proportion of 2/3 and 1/3 stood as at June 30, 2018 as follows:
Liabilities
Assets
A's Capital
1.02.900 Cash in hand
4.500
B's Capital
73.500 | Stock
54,000
Creditors
23.600 Debtors
36,000
Bills Payable
500 Furniture
6,000
Plant & Machinery
1,00,000
2.00,500
2,00.500
On July 1, 2018, they agreed to take C into partnership giving him 1/5th share of
profit on the following terms:
(a) The goodwill of the firm is to be valued at two year's purchase of profit
calculated on the average of the last three year's profits amounting to 40,000,
30,000 and 44,075.
(6) C brings his share of goodwill in cash, which is retained in the business.
(C) Partners decide to share future profits in the ratio of 3:1:1.
(d) C also brings in capital in proportion to his profit sharing ratio arrangement,
Prepare Journal entries and prepare the Capital Accounts of the partners.
[Ans. Total Goodwill of the firm 76,050; Sacrifice Ratio 1:2. Capital A/cs:
A 1,07,970; B 83,640; C 47,902.]
Thai Polone​

Answer 1

Answer:

Total Goodwill of the firm 76,050; Sacrifice Ratio 1:2. Capital A/cs:

A 1,07,970; B 83,640; C 47,902.