InterviewSolution
Saved Bookmarks
InterviewSolution
| 1. |
X, Y and Z are partners sharing profits and losses in the ratio of 5 : 3 : 2. From 1st April, 2018, they decided to share profits and losses equally. The Partnership Deed provides that in the event of any change in the profit-sharing ratio, the goodwill should be valued at two years' purchase of the average profit of the preceding five years. The profits and losses of the preceding years ended 31st March, are: Year 2013-14 2014-15 2015-16 2016-17 2017-18 Profits (₹) 70,000 85,000 45,000 35,000 10,000 (Loss) You are required to calculate goodwill and pass journal entry. |
||||||||||||
Answer» X, Y and Z are partners sharing profits and losses in the ratio of 5 : 3 : 2. From 1st April, 2018, they decided to share profits and losses equally. The Partnership Deed provides that in the event of any change in the profit-sharing ratio, the goodwill should be valued at two years' purchase of the average profit of the preceding five years. The profits and losses of the preceding years ended 31st March, are:
You are required to calculate goodwill and pass journal entry. |
|||||||||||||