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Standard VI

Mathematics

Word Problems

A and B are...

Question

$A$ and $B$ are partners in a firm sharing profits and losses in the ratio of $3 : 2$ . $A$ new partner $C$ is admitted. $A$ surrender $1 / 5^{t h}$ of his share and $B$ surrender $2 / 5^{t h}$ of his share in favour of $C$ . For the purpose of $C^{'} s$ admission, goodwill of the firm is valued at $R s . 75, 000$ and $C$ brought in his share of goodwill in cash which is retained in the firm's books. Journalise the above transactions.

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Solution

JOURNAL
1. Cash a/c..... Dr. 21000
To Premium for goodwill a/c 21000
(Being Premium for goodwill brought in by C)

2. Premium for goodwill a/c.... Dr. 21000
To A's Capital a/c 9000
To B's Capital a/c 12000
(Being premium for goodwill brought in by C, distributed among the partners in the ratio 3:4)

Working Note:
A's old share= 3/5
B's old share= 2/5

C is admitted as a new partner.
A's sacrifice= 3/5 * 1/5
= 3/25
B's sacrifice= 2/5 * 2/5
= 4/25
Sacrificing ratio= 3:4

C's share= 3/25 + 4/25
= 7/25
Hence, C's share of goodwill= 7/25 * 75000
= 21000

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Similar questions

Q. A and B are partners in a firm sharing profits and losses in the ratio of 3 : 2. A new partner C is admitted. A surrenders 1/5th of his share and B surrenders 2/5th of his share and B surrenders 2/5th of his share in favour of C. For the purpose of C's admission, goodwill of the firm is valued at ₹ 75,000 and C brings in his share of goodwill in cash which is retained in the firm's books. Journalise the above transactions.

(a) A and B are partners in a firm sharing profits in the ratio of 3 : 2. C is admitted as a partner. A and B surrender $\frac{1}{2}$ of their respective share in favour of C. Find the new profit sharing ratio and also the sacrificing ratio.

(b) C is to bring his share of premium for goodwill in cash. The goodwill of the firm is estimated at Rs 4,00,000. Pass necessary entries for the record of goodwill in the above case.

Q. Find new Profit-Sharing Ratio:
(i)

R

and

T

are partners in a firm sharing profits in the ratio of

3 : 2

S

joins the firm.

R

surrenders

1 / 4^{t h}

of his share and

T

surrenders

1 / 5^{t h}

of his share in favour of

S

.
(ii)

A

and

B

are partners.They admit

C

for

1 / 4^{t h}

share. In future, the ratio between

A

and

B

would be

2 : 1

.
(iii)

A

and

B

are partners sharing profits and losses in the ratio of

3 : 2

. They admit

C

for

1 / 5^{t h}

share in profit.

C

acquires

1 / 5^{t h}

of his share from

A

and

4 / 5^{t h}

share from

B

.
(iv)

X, Y

and

Z

are partners in the ratio of

3 : 2 : 1

W

joins the firm as a new partners for

1 / 6^{t h}

share in profits.

Z

would retain his original share.
(v)

A

and

B

are equal partners. they admit

C

and

D

as partners with

1 / 5^{t h}

and

1 / 6^{t h}

share respectively.
(vi)

A

and

B

are partners sharing profits/losses in the ratio of

3 : 2

C

is admitted for

1 / 4^{t h}

share.

A

and

B

decide to share equally in future.

A

and

B

were partners in firm sharing profits and losses in the ratio of

5 : 3

. They admitted

C

as a new partner. The new profit sharing ratio between

A, B

and

C

was

3 : 2 : 3

. A surrendered

{\frac{1}{5}}^{t h}

of his share in favour of

C

. Calculate

B^{'} s

sacrifice.

A, B and C are partners, sharing profits in the ratio of 4 : 3 : 2. D is admitted for $\frac{2}{9}$ share of profits and brings Rs 3.00,000 as his capital and Rs 1,00,000 for his share of goodwill. The new profit sharing ratio will be A : B : C : D. 3 : 2 : 2 : 2.

Journalise the above arrangement in the books.

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