Question 26:
A and B
are partners in a firm sharing profits and losses in the ratio of 3 : 2. They admit C into partnership for 1/5th
share. C brings ` 30,000 as capital and ` 10,000 as
goodwill. At the time of admission of C, goodwill appeared in the
Balance Sheet of A and B at ` 3,000. New
profit-sharing ratio of the partners will be 5 : 3 :
2. Pass necessary Journal entries.
Answer:
|
Journal Entries |
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|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
A’s Capital A/c |
Dr. |
|
1,800 |
|
|
|
B’s Capital A/c |
Dr. |
|
1,200 |
|
|
|
To Goodwill A/c |
|
|
|
3,000 |
|
|
(Goodwill written-off) |
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Cash A/c |
Dr. |
|
40,000 |
|
|
|
To C’s Capital A/c |
Dr. |
|
|
30,000 |
|
|
To Premium for Goodwill A/c |
|
|
|
10,000 |
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|
(C brought capital and his share of goodwill in cash) |
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Premium for Goodwill |
Dr. |
|
10,000 |
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To A’s Capital A/c |
|
|
|
5,000 |
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|
To B’s Capital A/c |
|
|
|
5,000 |
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|
(Premium for Goodwill distributed) |
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A |
B |
C |
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OLD RATION |
3 : |
2 : |
1 |
|
NEW RATIO |
5 : |
3 : |
2 |
Sacrificing Ratio = Old Ratio − New Ratio
|
A’s |
=3/5-5/10 |
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=1/10 |
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B’s |
=2/5-3/10 |
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=1/10 |
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X |
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Y |
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Sacrificing Ratio = |
1/10 |
: |
1/10 |
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= |
1 |
: |
1 |
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Distribution of Premium for Goodwill C’s share of Goodwill)
A and B each will get =10,000×1/2=5,000
Goodwill
written-off
A’s capital will be debited =3,000×3/5=1,800
B’s
capital will be credited =3,000×2/5=1,200
Question 27:
Anu and Bhagwan
were partners in a firm sharing profits in the ratio of 3 :
1. Goodwill appeared in the books at `4,40,000. Raja was admitted
to the partnership. The new profit-sharing ratio among Anu,
Bhagwan and Raja was 2 : 2 :
1.
Raja brought `1,00,000
for his capital and necessary cash for his goodwill premium. Goodwill of the
firm was valued at `2,50,000.
Record necessary Journal entries in the books of the firm for the above
transactions.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
Anu’s Capital
A/c |
Dr. |
|
3,30,000 |
|
|
|
Bhagwan’s
Capital A/c |
Dr. |
|
1,10,000 |
|
|
|
To Goodwill A/c |
|
|
|
4,40,000 |
|
|
(Old goodwill written off in old ratio) |
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|
|
|
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Cash A/c |
Dr. |
|
1,50,000 |
|
|
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To Raja’s Capital A/c |
|
|
|
1,00,000 |
|
|
To Premium for Goodwill A/c |
|
|
|
50,000 |
|
|
(Capital and goodwill brought in by Raju) |
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Premium for Goodwill A/c |
Dr. |
|
50,000 |
|
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Bhagwan’s
Capital A/c 320×2,50,000 |
Dr. |
|
37,500 |
|
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To Anu’s Capital A/c 720×2,50,000 |
|
|
|
87,500 |
|
|
(Premium for goodwill adjusted) |
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|
Working
Notes:
WN1 Calculation of Share in Old
Goodwill
Anu's share=4,40,000×3/4=3,30,000
Bhagwan's share=4,40,000×1/4=1,10,000
WN2 Calculation of Raja's Share of
Goodwill
Raja's Share of Goodwill=Firm's Goodwill×Raja's Profit Share
=2,50,000×1/5=50,000
WN3 Calculation of Sacrificing Ratio
Sacrificing Ratio=Old Share-New Share
Anu's=3/4-2/5=7/20(sacrifice)
Bhagwan's=1/4-2/5=-3/20(gain)
Question 28:
Ram and Mohan
are partners in a firm sharing profits in the ratio of 3 :
2. On 1st April, 2022, they admit Sohan as
a partner for 1/4th share in the profits. Sohan
contributed following assets towards his capital and for his share of
goodwill:
Stock ` 60,000; Debtors
` 80,000;
Land ` 1,00,000, Plant and Machinery ` 40,000.
On the date of admission of Sohan, the
goodwill of the firm was valued at
` 6,00,000.
Pass necessary Journal entries in the books of the firm on Sohan's admission.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
2022 |
|
|
|
|
|
|
April 1 |
|
|
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|
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Debtors A/c |
Dr. |
|
80,000 |
|
|
|
Land A/c |
Dr. |
|
1,00,000 |
|
|
|
Plant and Machinery A/c |
Dr. |
|
40,000 |
|
|
|
To Sohan’s Capital A/c |
|
|
1,30,000 |
|
|
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To Premium for Goodwill A/c |
|
|
1,50,000 |
|
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(Z brought assets for his share of goodwill and Capital) |
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April 1 |
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|
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To Ram’s Capital A/c |
|
|
90,000 |
|
|
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To Mohan’s Capital A/c |
|
|
60,000 |
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(Sohan’s share of Goodwill distributed between Ram and Mohan in sacrificing ratio) |
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Working Notes:
WN1
Z’s share of goodwill=6,00,000×1/4=1,50,000
WN2
Distribution of Z’s Goodwill
X will get =1,50,000×3/5=90,000
Y will get =1,50,000×2/5=60,000
Question 29:
A and B are partners in a business sharing profits and
losses in the ratio of 1/3rd and 2/3rd. On 1st April, 2022, their capitals
were ` 8,000 and ` 10,000 respectively. On that date, they admit C in
partnership and give him 1/4th share in the future profits. C
brings ` 8,000 as his capital and ` 6,000 as goodwill. The amount of goodwill is withdrawn by
the old partners in cash. Draft the journal entries and show the Capital
Accounts of all the Partners. Calculate proportion in which partners would
share profits and losses in future.
Answer:
|
Journal |
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|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
2022 |
|
|
|
|
|
|
April 1 |
|
|
|
|
|
|
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To C’s Capital A/c |
|
|
8,000 |
|
|
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To Premium for Goodwill A/c |
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|
6,000 |
|
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(C brought capital and his share of goodwill) |
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April 1 |
|
|
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To A’s Capital A/c |
|
|
2,000 |
|
|
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To B’s Capital A/c |
|
|
4,000 |
|
|
|
(C’s share of
goodwill distributed between |
|
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A’s Capital A/c |
Dr. |
|
2,000 |
|
|
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B’s Capital A/c |
Dr. |
|
4,000 |
|
|
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To Cash A/c |
|
|
6,000 |
|
|
|
(Amount of goodwill withdrawn by A and B) |
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Partners’ Capital Accounts |
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|
Dr. |
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Cr. |
|
Particulars |
A |
B |
C |
Particulars |
A |
B |
C |
|
Cash |
2,000 |
4,000 |
- |
Balance b/d |
8,000 |
10,000 |
- |
|
|
|
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Cash |
- |
- |
8,000 |
|
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|
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Premium for Goodwill |
2,000 |
4,000 |
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Balance c/d |
8,000 |
10,000 |
8,000 |
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10,000 |
14,000 |
8,000 |
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10,000 |
14,000 |
8,000 |
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Calculation of New (Future) Ratio
|
|
A |
B |
|
OLD
RATION |
1 : |
2 : |
C is admitted for ¼ share of profit
Let combined share of all partners after C’s admission be = 1
Combined share of A and B after C’s admission = 1 − C’s share
=1-1/4
=3/4
New
ratio= old ratio × Combined share of A and B in the new
firm
|
A’s |
=1/3×3/4 |
|
|
=3/12 |
|
B’s |
=2/3×3/4 |
|
|
=6/12 |
|
|
A |
|
B |
|
C |
|
New profit sharing ratio= |
3/12 |
: |
6/12 |
: |
1/4 |
|
= |
3/12 |
: |
6/12 |
: |
3/12 |
|
= |
1 |
: |
2 |
: |
1 |
Distribution of Premium for Goodwill
A will get =6,000×1/3=2,000
B will get =6,000×2/3=4,000
Question 30:
A
and
B were partners in a firm sharing profits and losses in the ratio of 3 : 2. They admitted C as a new partner for 3/7th
share in the profit and the new profit-sharing ratio will be 2
: 2 : 3. C brought ` 2,00,000 as his capital and ` 1,50,000 as
premium for goodwill. Half of their share of premium was withdrawn by A
and B from the firm. Calculate sacrificing ratio and pass necessary
Journal entries for the above transactions in the books of the firm.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
|
|
|
|
|
|
|
|
Cash A/c |
Dr. |
|
3,50,000 |
|
|
|
To C’s Capital A/c |
|
|
2,00,000 |
|
|
|
To Premium for Goodwill A/c |
|
|
1,50,000 |
|
|
|
(C brought capital and Premium for Goodwill) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Premium for Goodwill A/c |
Dr. |
|
1,50,000 |
|
|
|
To A’s Capital A/c |
|
|
1,10,000 |
|
|
|
To B’s Capital A/c |
|
|
40,000 |
|
|
|
(Premium for Goodwill distributed) |
|
|
|
|
|
|
|
|
|
|
|
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|
A’s Capital A/c |
Dr. |
|
55,000 |
|
|
|
B’s Capital A/c |
Dr. |
|
20,000 |
|
|
|
To Cash A/c |
|
|
75,000 |
|
|
|
(Half of the goodwill withdrawn by A and B) |
|
|
|
|
|
|
|
|
|
|
|
Calculation of Sacrificing Ratio
Sacrificing
Ratio =Old ratio- new ratio
|
A’s |
=3/5-2/7 |
|
|||
|
|
=11/35 |
|
|||
|
B’s |
=2/5-2/7 |
|
|||
|
|
=4/35 |
|
|||
|
|
X |
|
Y |
|||
|
Sacrificing Ratio = |
11/35 |
: |
4/35 |
|||
|
= |
11 |
: |
4 |
|||
Working Notes-
WN1
Distribution of Premium for Goodwill
A will get =1,50,000×11/35=1,10,000
B will get 1,50,000×4/35=40,000
WN2
Amount of Premium for Goodwill withdrawn
A will get =1,10,000×1/2=55,000
B will get =40,000×1/2=20,000
Ts Grewal Solution 2022-2023
Click below for more Questions
Class 12 / Volume – I
Chapter 1 – Admission of a Partner
Question No. 1 To 5
Question No. 5 To 10
Question No. 11 To 15
Question No. 16 To 20
Question No. 21 To 25
Question No. 26 To 30
Question No. 31 To 35
Question No. 36 To 40
Question No. 41 To 45
Question No. 46 To 50
Question No. 51 To 55
Question No. 56 To 60
Question No. 61 To 65
Question No. 66 To 70
Question No. 71 To 75
Question No. 76 To 80
Question No. 81 To 83
Question No. 84 To 86
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12th TS Grewal’s Accountancy Solutions