Question

A and B are partners sharing profits and losses in the ratio of $3:2$. They admit C into the partnership for $1/4$th share. C brings in $Rs.6,000$ for capital and the requisite amount of premium in cash. The goodwill of the firm is valued at $Rs.9,600$. Partners withdrew their share of goodwill in cash. A and B withdrew ________.

• A. $Rs.1,440$ and $Rs.960$
• B. $Rs.960$ and $Rs.1,440$
• C. $Rs.1,200$ and $Rs.1,200$
• D. None of these

Answer 1

The correct option is A $Rs.1,440$ and $Rs.960$

At the time of admission of a new partner, goodwill brought in by new partner is distributed among old partner in their old ratio.

Goodwill brought in by new partner = Total goodwill of firm * C's share of profit

Goodwill brought in by new partner = Rs. 9600 * (1/4) = Rs. 2400

Goodwill brought in by C on his admission is distributed among A and B in their old ratio i.e., 3 : 2

Amount withdrawn by-

A = Rs. 2400 * (3/5) = 1440

B = Rs. 2400 * (2/5) = 960