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Question 05 Chapter 4 of +2-Part-1
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Table of Contents
5. (Goodwill exist in the balance sheet) P, Q and R are partners in 4:3:3 ratio. The new ratio is 1:2:2. Goodwill already in the books Rs.75,000 and at the time of change in ratio it is valued at Rs.1,05,000. Pass entries in journal:
The solution of Question 05 Chapter 4 of +2 Part-1: –
Journal | |||||
Date | Particulars | L.F. | Debit | Credit | |
(1) | P’s Capital A/c (75000*4/10) | Dr. | 30,000 | ||
Q’s Capital A/c (75000*3/10) | Dr. | 22,500 | |||
R’s Capital A/c (75000*3/10) | Dr. | 22,500 | |||
To Goodwill A/c | 75,000 | ||||
(Being amount of goodwill written off in the old profit sharing ratio) | |||||
(2) | Goodwill A/c | Dr. | 1,05,000 | ||
To P’s Capital A/c (1,05,000*1/5) | 21,000 | ||||
To Q’s Capital A/c (1,05,000*2/5) | 42,000 | ||||
To R’s Capital A/c ((1,05,000*2/5) | 42,000 | ||||
(Being amount of goodwill on change in profit sharing ratio) |
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Also, Check out the solved question of previous Chapters: –
Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution
- Chapter No. 1 – Accounting Not for Profit Organisations
- Chapter No. 2 – Partnership Accounts – I (Introduction)
- Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)
- Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)
- Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)
- Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)
- Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)
- Chapter No. 8 – Company Accounts (Share Capital)
- Chapter No. 9 – Company Accounts (Issue of Debentures)
- Chapter No. 10 – Company Accounts (Redemption of Debentures)
Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution
- Chapter No. 1 – Financial Statements of a Company
- Chapter No. 2 – Financial Statement Analysis
- Chapter No. 3 – Tools of Financial Statement Analysis- Comparative and Common Size
- Chapter No. 4 – Ratio Analysis
- Chapter No. 5 – Cash Flow Statement
Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication
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Practical problem 5 of chapter 4 I can’t understand it’s 2nd step l mean I want to know why we do this I hope u understand and solve my problem
Thanks for the comment.
Yes, I will help you to understand it.
We have two types of goodwill in the question.
1. Already in the books
2. After revaluation
The 1st type of goodwill is already in the books, So we have to distribute it to all partners in the old profit sharing ratio to written off it from the books. Because it is related to the previous period in this period the profit is distributed as per the old profit sharing ratio.
The 2nd type of goodwill is revalued at the time of the changing profit sharing ratio but this is not recorded in the books, So we have to record it in the books by posting 2nd journal entry. and distribute this in the new profit sharing ratio.
Where is question 5A