1.

A and B are in partnership sharing profitsand losses in the ratio of 5 : 3. C is admitted as a partner who pays ₹ 40,000 as capital and the necessary amount of goodwill which is valued at ₹ 60,000 for the firm. His share of profits will be 1/5th which he takes 1/10th from A and 1/10th from B. Give journal entries and also calculate future profit-sharing ratio of the partners.

Answer»

rificing Ratio of A and B is , New PROFIT Sharing Ratio A, B and C is and Distribution of C’s SHARE of GOODWILL is 6,000.Explanation:1) SACRIFICING Ratio A and B 2) Old Ratio A and B     New Ratio = Old Ratio - Sacrificing Ratio     A’s New share     B’s New share     New Profit Sharing Ratio A, B and C 3) Distribution of C’s Share of Goodwill (SACRIFICE Ratio)      A’s Goodwill      B’s Goodwill



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