Question

x and y are partners with capitals of rs 20,000 each. they admit Z for 1/4 th share into partnership. Z brings rs32,000 as his share of capital. the profit and loss account showed a credit balance of rs16,000 on the date of Z's admission. Give necessary journal entry to record the goodwill​

Answer 1

Answer:

In this question Goodwill is hidden

sowe calculate Goodwill on the basis ofmew partner capital

z bring 32000 capital for 1/4 share according to Z share total capital of firm will 32000×4 = 128000

total capital of firm. =. 128000

(-) adjusted capital o X& Y = 56000

(-) capital of Z. . =. ...32000

Goodwill of firm =. 40000

z share of goodwill = 40000*1/4 = 10000

journal

Z'current a/c. Dr. 10000

To X's capital a/c. 5000

To Y ' s capital a/v. 5000

Explanation:

adjusted capital ( 40000+ 16000)= 56000

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