1.

A and B are partners in a firm sharing profits and losses in theratio of 3:2. They decide to admit C into partnership with 1/4 sharein profits. C will bring in Rs. 30,000 for capital and the requisiteamount of goodwill premium in cash. The goodwill of the firm isvalued at Rs, 20,000. The new profit sharing ratio is 2:1:1. A and Bwithdraw their share of goodwill. Give necessary journal entries?

Answer»


A and B are partners in a firm sharing profits and losses in the
ratio of 3:2. They decide to admit C into partnership with 1/4 share
in profits. C will bring in Rs. 30,000 for capital and the requisite
amount of goodwill premium in cash. The goodwill of the firm is
valued at Rs, 20,000. The new profit sharing ratio is 2:1:1. A and B
withdraw their share of goodwill. Give necessary journal entries?



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