1.

Anu and Bhagwan were partners in a firm sharing profits in the ratio of 3 : 1. Goodwill appeared in the books at ₹ 4,40,000. Raja was admitted to the partnership. The new profit-sharing ratio among Anu, Bhagwan and Raja was 2 : 2 : 1. Raja brought ₹ 1,00,000 for his capital and necessary cash for his goodwill premium. The goodwill of the firm was valued at ₹ 2,50,000. Record necessary journal entries in the books of the firm for the above transactions.

Answer»

(i) ANU's Capital a/c... Dr. 330000Bhagwan's Capital a/c.... Dr. 110000To GOODWILL a/c 440000(Being goodwill written off)(ii) Bank a/c.... Dr. 150000To Raja's Capital a/c 100000To Premium for Goodwill a/c 50000(Being CASH and premium for goodwill brought in by Raja)(iii) Premium for goodwill a/c.... Dr. 50000Bhagwan's Capital a/c.... Dr. 37500To Anu's Capital a/c 87500(Being premium for goodwill and Bhagwan's gain transferred to Anu)Working Note:Calculation of sacrificing ratio:Anu's sacrifice= 3/4- 2/5= 7/20Bhagwan's gain= 1/4- 2/5= -3/20Total goodwill of the firm= 250000Bhagwan's share= 3/20* 250000= 37500



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