Question 26 Chapter 5 - Unimax Class 12 Part 1 - 2021

Question 26 Chapter 5 – Unimax Class 12 Part 1 – 2021

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The solution of Question 26 Chapter 5 – Unimax Class 12 Part 1

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

26. R and S are partners sharing profits and losses in the ratio 5 : 3. They agree to admit Q for 1/3rd share in profits. Q brings Rs. 150000 as capital. Goodwill of firm is valued at Rs. 120000. But Q is unable to bring his share of goodwill in cash. Pass necessary journal entries.

The solution of Question 26 Chapter 5 – Unimax Class 12 Part 1

Date	Particulars		L.F.	Debit	Credit
	Cash a/c	Dr.		150000
	To Q’s Capital a/c				150000
	(Being Capital contributed by new partner)
	Q’s Capital a/c	Dr.		40000
	To R’s Capital a/c				25000
	To S’s Capital a/c				15000
	(Being compensation paid by Q to R and S for his share of goodwill)

Working Note
Q’s share of goodwill = 120000 X 1/3 = Rs. 40000
(iii) If nothing has been mentioned in the sum about partner’s sacrificing ratio, so they will sacrifice in their old ratio.