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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
A, B and C are partners sharing profits in the ratio of 4/9 : 3/9 : 2/9. B retires and his capital, after making adjustments for reserves and gain on revaluation, stands at ₹1,39,200. A and C agree to pay him ₹1,50,000 in full settlement. Record the necessary Journal entry for the adjustment of goodwill if the new profit-sharing ratio is 5 : 3.
Hidden Goodwill (B’s share) = ₹1,50,000 – ₹1,39,200 = ₹10,800. Gaining ratio: A = 5/8 – 4/9 = 13/72; C = 3/8 – 2/9 = 11/72 → 13 : 11.
JOURNAL
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| A’s Capital A/c Dr. (10,800 × 13/24) | 5,850 | |||
| C’s Capital A/c Dr. (10,800 × 11/24) | 4,950 | |||
| To B’s Capital A/c | 10,800 | |||
| (B’s share of hidden goodwill adjusted in the gaining ratio 13 : 11) |
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.19 - Retirement of a Partner", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 5 - Retirement of a Partner.
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