Question 40 Chapter 5 – Unimax Class 12 Part 1 – 2021

Question 40 Chapter 5 - Unimax Class 12 Part 1 - 2021

Question 40 Chapter 5 – Unimax Class 12 Part 1 – 2021

Free Accounting book Solution - Class 11 and Class 12

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

 

What is Partnership – Meaning and its Types

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

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)

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

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