Question

Keshav, Nirmal and Pankaj are partners sharing profits and losses in the ratio of 4 : 3 : 2. Nirmal retires and the goodwill is valued at Rs. 72,000. Keshav and Pankaj decided to share future profits and losses in the ratio of 5 : 3. What will be the net effect on Keshav`s and Pankaj's capital account?

• A. None of the above
• B. 20,000 & Rs 10,000
• C. Rs 13,000 & Rs 11,000
• D. Rs 12,000 & Rs 10,000

Answer 1

The correct option is C

Rs 13,000 & Rs 11,000

	Keshav	Nirmal	Pankaj
Before retirement(4:3:2)	32,000	24,000	16,000
After retirement(5:3)	45,000		27,000
Net Effect	13,000 (Dr)		11,000 (Dr)