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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
P, Q, R and S were partners sharing profits in the ratio of 5 : 3 : 1 : 1. On 1st January, 2024, S retired. Goodwill of the firm was valued at ₹4,20,000. The new profit-sharing ratio among P, Q and R is 4 : 3 : 3. Pass the necessary Journal entry for the treatment of goodwill.
Gain / (Sacrifice) = New – Old: P = 4/10 – 5/10 = –1/10 (Sacrifice); Q = Nil; R = 3/10 – 1/10 = 2/10 (Gain). S’s share = ₹4,20,000 × 1/10 = ₹42,000.
JOURNAL
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| 2024 Jan 1 | R’s Capital A/c Dr. (4,20,000 × 2/10) | 84,000 | ||
| To P’s Capital A/c (4,20,000 × 1/10) | 42,000 | |||
| To S’s Capital A/c (4,20,000 × 1/10) | 42,000 | |||
| (R, the only gaining partner, compensates the sacrificing partner P and the retiring partner S) |
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 "T.S. Grewal Class 12 Chapter 5 Q.13 - Retirement of a Partner", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 5 - Retirement of a Partner.
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.
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