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Question 40 Chapter 5 – Unimax Class 12 Part 1 – 2021
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40. P and Q are in partnership sharing profit and loss in 3 : 1. They admit R into the firm, R paying a premium of Rs. 15000 for 1/3rd share of the profits. As between themselves, P and Q agree to share future profits and losses equally. Pass necessary journal entries.
The solution of Question 40 Chapter 5 – Unimax Class 12 Part 1
Journal
| Date | Particulars | L.F. | Debit | Credit | |
| Cash a/c | Dr. | 15,000 | |||
| To Premium a/c | 15,000 | ||||
| (Being goodwill brought in cash by new partner) | 10,000 | ||||
| Premium a/c | Dr. | 15,000 | |||
| To P’s Capital a/c | 15,000 | ||||
| (Being goodwill brought by new partners credited to sacrificing partners’ capital a/c) | |||||
| Q’s Capital a/c | 3,750 | ||||
| To P’s Capital a/c | 3,750 | ||||
| (Being compensation paid by Q to P for his gaining share) |
Working Note
Let total profit = 1
R’s Share =1/3
Remaining Share = 1 -1/3 =3-1/3 =2/3
P’s new share =1/2 X 2/3
=1/3
Q’s new share =1/2 X 2/3 =1/2
New PSR = 1 : 1 : 1
P’s Sacrifice =3/4_1/3 =5/12
Q’s Sacrifice =1/4_1/3 =5/12
So P has made sacrifice 5/12 of his share
Total goodwill of firm = Rs. 15000 X 3/1 = Rs. 45000
Q’s compensation = 45000 X 1/12 = Rs. 3750
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What is Partnership – Meaning and Its 4 Types
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)
- Chapter No. 8 – Company Accounts – Accounting for Share Capital
- Chapter No. 9 – Company Accounts – Issue of Debentures
- Chapter No. 10 – Redemption of Debentures
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