Solve 30

Q30. P and Q are partners sharing profit & losses as 2 : 3. R and S are amities and profit sharing ratio becomes 3 : 4 : 3 : 2. Goodwill is valued at 3,00,000, R brings  required goodwill and Rs. 2,00,000 cash for Capital .S brings in Rs.1,00,000 cash and Motor Vehicle for Rs/80,000 as his Capital in addition to the required amount of goodwill in cash.
  Show the necessary journal entries .
[Ans. Sacrificing Ratio 9 : 16 .]

Dear Student,


Old ratio between P & Q was 2:3 ; New ratio after R & S's admission is 3:4:3:2
Sacrificing ratio = 9:16

 
Date  Particulars  LF  Amount (in Rs)  Amount (in Rs)
   Cash A/c  Dr  2,75,000  
        To R's Capital A/c      2,00,000
        To Premium for Goodwill A/c (3,00,000*3/12)         75,000
   (R brings his share of Capital & Goodwill)      
         
   Cash A/c  Dr  1,50,000  
    Motor Vehicle A/c      80,000  
         To S's Capital A/c      1,80,000
         To Premium for Goodwill A/c (3,00,000*2/12)        50,000
   (S brings his share of Capital & goodwill)      
         
   Premium for Goodwill A/c (1,25,000)  Dr  1,25,000  
        To P's Capital A/c       45,000
        To Q's Capital A/c      80,000
   (Goodwill divided among old partners in sacrificing ratio)      

Regards,

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