Loading Tutorstips...
✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Advertisement
Advertisement
Advertisement
Advertisement
Question 28 Chapter 5 of +2-A
28. Anshul and Parul are partners sharing profits in the ratio of 3 : 2. They admit Payal as partner for 1/4th share in profits on 1st April, 2019. Payal brings 5,00,000 as capital and her share of goodwill by cheque. It was agreed to value goodwill at three years' purchase of average profit of last four years. Profits for the last four years ended 31st March,
| 2015-16 | 4,00,000 |
| 2016-17 | 5,00,000 |
| 2017-18 | 6,00,000 |
| 2018-19 | 7,00,000 |
Additional Information:
The solution of Question 28 Chapter 6 of +2-A
| Date | Particulars |
L.F. | Debit | Credit | |
|---|---|---|---|---|---|
| Bank A/c | Dr | 8,37,500 | |||
| To Payal’s Capital A/c | 5,00,000 | ||||
| To Premium for Goodwill A/c | 3,37,500 | ||||
| (Being C brought his share of goodwill) | |||||
| Premium for Goodwill A/c | Dr | 3,37,500 | |||
| To Anshul’s Capital A/c | 2,02,500 | ||||
| To X’s Capital A/c | 1,35,000 | ||||
| (Being goodwill distributed among the old partners’ in their sacrificing ratio) | |||||
| Particulars / Year Ended |
31st March, 2016 |
31st March, 2017 |
31st March, 2018 |
31st March, 2019 |
|---|---|---|---|---|
| Profit/(Loss) | 4,00,000 | 5,00,000 | 6,00,000 | 7,00,000 |
| Less: Overvaluation of Closing Stock | - 50,000 | |||
| Add: Overvaluation of Opening Stock | 50,000 | |||
| Less: Annual Charge for Management Cost | - 1,00,000 | -1,00,000 | -1,00,000 | -1,00,000 |
| Adjusted Profits/(Loss) | 3,00,000 | 4,00,000 | 4,50,000 | 6,50,000 |
| Average Profit | = | Total Profit for past given years |
| Number of years |
| Average Profit | = | 3,00,000+4,00,000+4,50,000+6,50,000 |
| 4 |
| Average Profit | = | 18,00,000 |
| 4 | ||
| = | 4,50,000 |
| Number of years’ purchase | = | 3 |
| Goodwill | = | Average Profit X Number of years’ purchase |
| Goodwill | = | 4,50,000 X 3 |
| Goodwill | = | 13,50,000 |
| Old Ratio of Anshul and Parul | = | 3 : 1 |
| New Ratio of Anshul, Parul and Payal | = | 1 : 1 : 1 |
Sacrificing Share = Old Ratio - New Ratio
| Anshul’s Sacrificing Share | = | 3 | - | 1 |
| 4 | 3 |
| = | 9 - 4 |
| 12 |
| = | 5 | Sacrifice |
| 12 |
| Y’s Sacrificing Share | = | 1 | - | 1 |
| 4 | 3 |
| = | 3 - 4 |
| 12 |
| = | (-1) | Gains |
| 12 |
| Total Firm’s Goodwill | = | 13,50,000 |
| Payal’s share of Goodwill | = | 13,50,000 | X | 1 |
| 4 | ||||
| = | 3,37,500 |
Distribution of Payal’s share of Goodwill
Share of Goodwill = Payal’s Goodwill X Partners’ Sacrifice share
| Anshul’s Share of Goodwill | = | 3,37,500 | X | 3 |
| 5 | ||||
| = | 2,02,500 |
| Parul’s Share of Goodwill | = | 3,37,500 | X | 2 |
| 5 | ||||
| = | 1,35,000 |
Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication
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.
This guide covers "Q.No.28 | Chapter 5 – Admission of Partner | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
You can take our custom-built interactive practice quiz directly on this page to test your understanding of "Q.No.28 | Chapter 5 – Admission of Partner | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1" instantly.
