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Question 26 Chapter 5 of +2-Part-1
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26.( Different cases of goodwill) A and B shared profits in the proportion of 3 and 2 had capitals of Rs. 20,000 and Rs. 15,000 respectively. They agree tp admit C into partnership on the following terms for a third share in the future profits :
- That C should bring in Rs. 20,000 as capital.
- That as C is unable to bring his share of goodwill in cash the goodwill of the firm be valued at Rs. 15,000. set out the journal entries required , the capital accounts of partners. State the future profit sharing proportion of the partners.
We are providing a solution of Question 26 Chapter 5 of +2 Part-1 in two formats. one is in Video format and another is in article format. Check out both formats as follows:
1. Check out the Solution of this question in Video Format:-
The video consists solution of question numbers from 24 to 32 Chapter no. 5 class 12 of Usha publication. To check the direct solution of question no. 26 from the flowing video by using time stamps of the video.
2. Check out the Solution of this question in Article Format:-
The solution of Question 26 Chapter 5 of +2 Part-1: –
Journal | |||||
Date | Particulars | L.F. | Debit | Credit | |
i) | Cash A/c | Dr. | 20,000 | ||
To Goodwill A/c | 20,000 | ||||
(Being existing goodwill written off . ) | |||||
ii) | C’s current A/c | Dr. | 5,000 | ||
To A’s Capital A/c | 3,000 | ||||
To B’s Capital A/c | 2,000 | ||||
(Being C’s share in goodwill adjusted in 3:2) | |||||
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NOTE: Goodwill not brought in cash is adjusted through the current account of new partner due to provisions of AS-26
Partners’ Capital Account | |||||||
Particulars | A | B | C | Particulars | A | B | C |
To A’s capital A/c | 3,000 | To Balance b/d | 20,000 | 15,000 | |||
To B’s Capital A/c | 2,000 | To Cash A/c | 20,000 | ||||
To C’s capital A/c | 3,000 | 2,000 | |||||
To Balance c/d | 23,000 | 17,000 | 15,000 | ||||
23,000 | 17,000 | 15,000 | 23,000 | 17,000 | 15,000 |
Calculation of new profit sharing ratio
Let total profit of the firm = Re.1
Share of profit acquired by C | = | 1 |
3 |
Remaining share | = | 1 | – | 1 |
3 | ||||
= | 2 | |||
3 |
A’s New share | = | 3 | x | 2 |
5 | 3 | |||
= | 6 | |||
15 |
B’s New share | = | 2 | x | 2 |
5 | 3 | |||
= | 4 | |||
15 |
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C’s share | = | 1 | or | 5 |
3 | 15 |
New Ratio | = | 6 | : | 4 | : | 5 |
15 | 15 | 15 | ||||
= | 6 | : | 4 | : | 5 |
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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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