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Calculating Gaining Ratio

A and B are p...

Question

A and B are partners sharing the profit in the ratio of 3 : 2 they take C as the new partner, who brings in 25,000 against capital and 10,000 against goodwill. New profit sharing ratio is 1 : 1 : 1. In what ratio will this amount be shared among the old partners A and B?

A

8, 000 : 2, 000

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B

5, 000 : 5, 000

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C

Old partners will not get any share in the goodwill bought in by C.

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D

6, 000 : 4, 000

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Solution

The correct option is B $8, 000 : 2, 000$
At the time of admission of a new partner, When capital goodwill is bring by the new partner it is divided among the partners in their gaining and sacrificing ratio. It means gaining partner's capital A/c is credited and sacrificing partner's capital A/c is debited.
Calculation of sacrificing ratio:
Sacrificing Ratio = Old Ratio - New Ratio
A's sacrificing ratio = (3/5) - (1/3) = 4/15
B's sacrificing ratio = (2/5) - (1/3) = 1/15
Therefore, sacrificing ratio of A and B is 4 : 1 or 8 : 2 or 8000 : 2000
Therefore, amount brought in by the new partner is divided among Sacrificing partner in sacrificing ratio i.e., 8000 : 2000 or 8 : 2 or 4 : 1

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Similar questions

Q. A & B are partners sharing the profit in the ratio of

3 : 2

. They take C as the new partner, who brings in Rs.

25, 000

against capital and Rs.

10, 000

against goodwill. New profit sharing ratio is

1 : 1 : 1

. In what ratio will this amount will be shared among the old partners A & B.

Q. A admitted as a new partner for 1/ 4 share of future profits, fails to bring in cash of Rs. 5,000 towards goodwill but the existing (old) partners B and C sharing profits in the ratio of 3 : 2 raise goodwill account at its full value. Therefore, partners will be credited for goodwill as:

A

B

are partners in a business sharing profits and losses in the ratio of

1 / 3^{r d}

2 / 3^{r d}

1^{s t}

April,2018, their capitals are

R s . 8, 000

R s . 10, 000

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1 / 4^{t h}

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Q. 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.

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