Question

$A$ and $B$ are partners sharing profits in the ratio of $3:2$. $C$ is admitted for $1/4th$ share of profits and brings $Rs.10,000$ as his capital. But he is not able to bring in cash for his share of goodwill $Rs.3,000$. How will you treat this?

• A. Goodwill is raised by $Rs.12,000$
• B. $C$ will remain as debtor for $Rs.3,000$
• C. $C^{\prime }s$ A/c is debited for $Rs.3,000$
• D. Goodwill is raised by $Rs.9,000$

Answer 1

The correct option is C $C^{\prime }s$ A/c is debited for $Rs.3,000$

Date	Particulars	L.F.	Dr. (Rs)	Cr. (Rs)
1.	Cash A/c		10,000
	To C’s Capital A/c			10,000
2.	C’s Capital A/c		3000
	To A’s Capital A/c (3/5)			1800
	To B’s Capital A/c (2/5)			1200