# Question 43 Chapter 5 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question No.43 Chapter No.5 - T.S. Grewal +2 Book 2019-Solution

Question 43 Chapter 5 of +2-A

43. Bhuwan and Shivam were partners in a firm sharing profits in the ratio of 3 : 2. Their capitals were 50,000 and 75,000 respectively. They admitted Atul on 1st April, 2018 as a new partner for 1/4th share in future profits. Atul brought 75,000 as his capital. Calculate the value of goodwill of the firm and record necessary Journal entries for the above transactions on

## The solution of Question 43 Chapter 5 of +2-A: –

 Date Particulars L.F. Debit Credit Bank A/c Dr 75,000 To Atul’s Capital A/c 75,000 (Being received Atul’s share of capital account) Atul’s Current A/c Dr 25,000 To Bhuwan’s Capital A/c 15,000 To Shivam’s Capital A/c 10,000 (Being for goodwill distributed in sacrificing ratio of 3:2)

### Working Note: –

Total Capital of the firm on the Basis of Atul’s Capital

Total Capital of the firm = Atul’s Capital * Reciprocal of his share

 = 75,000 * 4 1 = 3,00,000

Actual Capital of Firm = Capital of Old Partners + Incoming Partner’s Capital

 = 50,000+ 75,000+ 75,000 = 2,00,000

 Goodwill = Total Capital of the firm on basis of Charu’s Capital – Actual Capital of Firm = 3,00,000 -2,00,000 = 1,00,000
 Atul’s Share of Goodwill = Firm’s Goodwill  x Share of E’s
 = 1,00,000 X 1 4 = 25,000

Sacrificing Ratio of Bhuwan and Shivam = 3 : 2

 Bhuwan will get Share of Goodwill = Atul’s Goodwill  X Sacrifice share of Bhuwan

 = 25,000 X 3 5 = 15,000

 Shivam will get Share of Goodwill = Atul’s Goodwill  X Sacrifice share of Shivam
 = 25,000 X 2 5 = 10,000

### 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. 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