Question

Veena and Somesh were partners in a firm with capitals of 1,00,000
and 80,000 respectively. They admitted Nisha on 1st April, 2019 as a
new partner for ¼th share in the future profits of the firm. Nisha
brought 90,000 as her capital. Nisha acquired her share as
1/12th from Veena and the remaining from Somesh.
Calculate the value of goodwill of the firm and pass the necessary journal
entries on Nisha's admission.​

Answer 1

Explanation:

ANSWER

Partnership deed is the legal document containing all the terms and conditions on which the partnership is based and is signed by all the partners. If there is no partnership deed,partners are still entitled to share profits and losses. The ratio of sharing shall be equal even if they contribute different amount of capital.

So, the contention of Ramesh to share profits in the ratio of capital is invalid. Somesh and Ramesh have to share profits and losses equally in absence of a partnership deed.