InterviewSolution
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Singh and Sharma were partners in a firm sharing profit and losses in the ratio of 1:1 on 31-3-2019 their balance sheet was as follows |
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Answer» 1. Cash a/c .. Dr. 50000 Machinery a/c ... Dr. 70000 To PREMIUM for goodwill a/c 120000(Being cash and machinery brought in by G for his SHARE of profit as premium for goodwill)2. Premium for Goodwill a/c ... Dr. 120000 F's Capital a/c ... Dr. 30000 To E's Capital a/c 150000(Being premium for goodwill and F's gain TRANSFERRED to E)Working Note:1. CALCULATION of sacrificing ratio:E's OLD ratio= 3/4F's old ratio= 1/4New ratio of firm after admission= 1:1:1Sacrificing ratio = Old ratio - New ratioE's sacrifice = 3/4- 1/3= 5/12F's gain = 1/4- 1/3= -1/122. Total goodwill of the firm= 120000*3/1= 360000F's gain= 360000 * 1/12= 30000 |
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