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Question 20 Chapter 5 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 20 Chapter 5 of +2-A
Question No.20 Chapter No.5 - T.S. Grewal +2 Book 2019-Solution

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Question 20 Chapter 5 of +2-A

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20. A and B are partners sharing profits and losses in the ratio of 2 : 5. They admit C on the condition that he will bring 14,000 as his share of goodwill to be distributed between A and B. C’s share in the future profits or losses will be 1/4th. What will be the new profit-sharing ratio and what amount of goodwill brought in by C will be received by A and B?

 

The solution of Question 20 Chapter 6 of +2-A

Old Ratio of A and B=2 : 5
C is admitted for 1/4th share of profit  

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Let the total share of the business = 1
Remaining share of A and B after C’s Admission= Total Share – C’s Share

Remaining share=11
4
 =4 – 1
4
 =3
 4


To Calculate to New Ratio distribute the remaining share in the old ratio of old partners’

New Ratio= Combined share of A and B X Old Ratio

A’s New Ratio=3X2
4
 =6
 28



B’s New Ratio=3X5
47

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 =15
 28

 

C’s New Ratio=1X7
47
 =7
 28
New Profit sharing Ratio between A ,B and C=6 : 15 : 7

 

Distribution of C’s share of Goodwill
C’s share of Goodwill = 14,000

A’s get share of Goodwill=14,000X2
7
 =4,000  

 

B’s get share of Goodwill=14,000X2
7
 = 10,000  

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T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

  • Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
  • Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
  • Chapter No. 3 – Goodwill: Nature and Valuation
  • Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
  • Chapter No. 5 – Admission of a Partner
  • Chapter No. 6 – Retirement/Death of a Partner
  • Chapter No. 7 – Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

  • Chapter No. 1 – Financial Statements of a Company
  • Chapter No. 2 – Financial Statement Analysis 
  • Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
  • Chapter No. 4 – Accounting Ratios
  • Chapter No. 5 – Cash Flow Statement

 

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

+2 Book 1-min
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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