Question 16:
A, B and C are
partners sharing profits in the ratio of 3 : 2 : 1. B
retired and the new profit-sharing ratio between A and C was 2 : 1. On B's retirement, the goodwill of the firm
was valued at
` 90,000. Pass necessary Journal entry for the treatment of
goodwill on B's retirement.
Answer:
|
Journal |
||||
|
Particulars |
L.F. |
Debit ` |
Credit ` |
|
|
A’s Capital A/c |
Dr. |
|
15,000 |
|
|
C’s Capital A/c |
Dr. |
|
15,000 |
|
|
To B’s
Capital A/s |
|
|
30,000 |
|
|
(Being Adjustment B’s share of goodwill made) |
|
|
|
|
Working Notes:
WN 1 Calculation of Gaining Ratio
Old Ratio (A, B and C) = 3 : 2 : 1
B retires from the firm.
New Ratio (A and C) = 2 : 1
Gaining Ratio=New Ratio −
Old Ratio
A‘s share=2/3 -3/6 =4-3/6=1/6
B‘s share= 1/3 -1/6 =2-1/6=1/6
∴Gaining Ratio = 1 :
1
WN 2 Adjustment of Goodwill
Goodwill of the firm = `
90,000
B’s share of goodwill =90,000×2/3=30,000
This share of goodwill is to be debited to remaining Partners’ Capital
Accounts in their gaining ratio (i.e. 1 : 1).
A’s
and C’s capital will be debited =30,000×1/2=15000
Question 17: Aman, Bimal and Deepak are
partners sharing profits in the ratio of 2: 3: 5. The goodwill of the firm has
been valued at `37,500. Aman
retired. Bimal and Deepak decided to share profits
equally in future.
Calculate gain/sacrifice of Bimal and Deepak
on Aman's retirement and also pass necessary Journal
entry for the treatment of goodwill. (CBSE 2019)
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ( `) |
Credit ( `) |
|
|
Bimal’s
capital a/c |
Dr. |
7,500 |
|||
|
|
To Amal’s capital a/c |
7,500 |
|||
|
|
(Being Goodwill adjusted) |
||||
|
|
|
|
|
|
|
Working notes;
WN1-
Calculation of gaining and sacrificing ratio
|
|
Amal
|
Bimal
|
Deepak
|
Old ratio
|
2 :
|
3 :
|
5
|
New ratio
|
Retires
|
1 :
|
1
|
Bimal = 3/10-1/2=3-5/10= -2/10
Deepak =5/10-1/2=5-5/10= 0/10
Gaining ratio of Sunil and David=13:11
WN2-
Firms goodwill =37,500
Share of retiring partner Amal is 2/10
Share of Amal share =37,500×2/10=7,500
Bimal will compensate 7,500
Question 18:
Hanny, Pammy and Sunny are
partners sharing profits in the ratio of 3 : 2 : 1.
Goodwill is appearing in the books at a value of ` 60,000. Pammy
retires and at the time of Pammy's retirement,
goodwill is valued at
` 84,000. Hanny and Sunny decided to
share future profits in the ratio of 2 : 1. Record the
necessary Journal entries.
Answer:
|
Journal |
|||||
|
Date |
Particulars |
L.F. |
Debit ( `) |
Credit ( `) |
|
|
|
Hanny’s
Capital A/c |
Dr. |
|
30,000 |
|
|
|
Pammy’s
Capital A/c |
Dr. |
|
20,000 |
|
|
|
Sunny’s
Capital A/c |
|
|
10,000 |
|
|
|
To Goodwill
A/c |
|
|
|
60,000 |
|
|
(Being Old goodwill written-off in old ratio) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Hanny’s
Capital A/c |
Dr. |
|
14,000 |
|
|
|
Sunny’s
Capital A/c |
Dr. |
|
14,000 |
|
|
|
To Pammy’s Capital A/c |
|
|
|
28,000 |
|
|
(Being Adjustment for goodwill in gaining ratio) |
|
|
|
|
Working Notes:
WN1: Calculation of Pammy’s Share in Goodwill
Pammy's share=Firm's Goodwill×Pammy's Profit SharePammy's share =84,000×26=28,000 to be borne by gaining partners in gaining ratio
WN2: Calculation of Gaining
Ratio
Gaining Ratio = New Ratio − Old Ratio
Hanny's gain=2/3−3/6=1/6
Sunny's gain=1/3−1/6=1/6
Gaining Ratio=1:1
Question 19:
A, B and C are
partners sharing profits in the ratio of 4/9 : 3/9 :
2/9. B retires and his capital after making adjustments for reserves
and gain (profit) on revaluation stands at ` 1,39,200. A and C
agreed to pay him
` 1,50,000 in full settlement of his claim. Record necessary
Journal entry for adjustment of goodwill if the new profit-sharing ratio is
decided at 5 : 3.
Answer:
|
Journal |
|
|||||
|
Date |
Particulars |
L.F. |
Debit ` |
Credit
` |
||
|
|
A’s Capital A/c |
Dr. |
|
5,850 |
|
|
|
|
C’s Capital A/c |
Dr. |
|
4,950 |
|
|
|
|
To B’s Capital A/c |
|
|
|
10,800 |
|
|
|
(Being Adjustment of B’s share of goodwill) |
|
|
|
|
|
Working Notes
i. Calculation of B’s share of goodwill
A, B and C are sharing profits in ratio 4/9 : 3/9 : 2/9
B retires from the firm. Remaining partners agreed to pay him ` 1,50,000
B’s capital after making necessary adjustments ` 1,39,200
Therefore, Hidden Goodwill is `
(1,50,000 – 1,39,200) i.e. `
10,800
ii Gaining Ratio
New profit sharing ratio between A and B is 5:3
A's Gain=5/8-5/9=13/72
C's Gain=3/8-2/9=11/72
Gaining
ratio 13:11
Thus, B’s share of goodwill will be brought in by A and C in
the gaining ratio 13:11 i.e.
A’s capital will be debited
=10,800×13/24=5850
C’s capital will be debited
=10,800×11/24=4950
Question 20: Shivam, Kapil and Deepak are
partners sharing profits in the ratio of 3:1:2. On 31st March, 2022, Kapil retired and his capital account after adjustments of
reserve and profit on revaluation was ` 3,50,000. Shivam and Deepak paid him ` 4,20,000 in settlement of his claim. To settle his account, a computer of
` 4,20,000
was given to Kapil. Pass the necessary Journal
entries in the books of the firm.
Answer:
|
Date |
Particulars |
|
` |
` |
|
1. |
Shivam’s Capital A/c |
Dr. |
42,000 |
|
|
|
Deepak’s Capital A/c |
Dr. |
28,000 |
|
|
|
To Kapil’s Capital A/c |
|
|
70,000 |
|
|
(Kapil was compensated for his share of goodwill ) |
|
|
|
|
2. |
Kapil’s Capital A/c |
Dr. |
4,20,000 |
|
|
|
To Computer A/c |
|
|
4,20,000 |
|
|
(Computer was paid in consideration of Capital) |
|
|
|
Working
notes:
|
Kapil’s capital (after adjustments of reserve and profit on revaluation) |
= |
`
3,50,000 |
|
Less: Shivam and Deepak paid him capital in settlement of his claim |
= |
`
4,20,000 |
|
Hidden Goodwill (Share of Kapil in Goodwill) |
= |
` 70,000 |
Ts Grewal Solution 2022-2023
Click below for more Questions
Class 12 / Volume – I
Chapter 1 – Retirement of a Parnter
Question No. 1 To 5
Question No. 6 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 59
Click on below links for
12th TS Grewal’s Accountancy Solutions