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Question 26 Chapter 5 - Unimax Class 12 Part 1 - 2021
26. R and S are partners sharing profits and losses in the ratio 5 : 3. They agree to admit Q for 1/3rd share in profits. Q brings Rs. 150000 as capital. Goodwill of firm is valued at Rs. 120000. But Q is unable to bring his share of goodwill in cash. Pass necessary journal entries.
| Date | Particulars | L.F. | Debit | Credit | |
|---|---|---|---|---|---|
| Cash a/c | Dr. | 150000 | |||
| To Q’s Capital a/c | 150000 | ||||
| (Being Capital contributed by new partner) | |||||
| Q’s Capital a/c | Dr. | 40000 | |||
| To R’s Capital a/c | 25000 | ||||
| To S’s Capital a/c | 15000 | ||||
| (Being compensation paid by Q to R and S for his share of goodwill) |
Working Note
Q’s share of goodwill = 120000 X 1/3 = Rs. 40000
(iii) If nothing has been mentioned in the sum about partner’s sacrificing ratio, so they will sacrifice in their old ratio.
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Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
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