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Standard XII

Accountancy

Goodwill Valuation (Retirement)

X Y are par...

Question

X & Y are partners sharing profits in the ratio $5 : 3$ . They admitted Z for $1 / 5$ th share of profits, for which the paid Rs. $1, 20, 000$ against capital and Rs. $60, 000$ against goodwill. Find the capital balances for each partners taking Z's capital as base capital.

3, 00, 000; 1, 20, 000

1, 20, 000

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3, 00, 000; 1, 20, 000

1, 80, 000

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3, 00, 000; 1, 80, 000

1, 20, 000

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3, 00, 000; 1, 80, 000

1, 80, 000

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Solution

The correct option is A $3, 00, 000; 1, 80, 000$ & $1, 20, 000$
New Profit sharing ratio = 1 - 1/5 = 4/5
A= 5/8 * 4/5 = 20/40 ; B= 3/8 * 4/5 = 12/40 ; C= 1/5 * 8/8 = 8/40
i.e. 5 ; 3 ; 2.
Capitals = 120000 * 5 = 600000
A - 600000 * 5/10 = 300000
B - 600000 * 3/10 = 180000

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[2 marks]

Q. A & B are partners of a partnership firm sharing profits in the ratio of

5 : 3

with capital of Rs.

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. C was admitted on the following terms: C would pay Rs.

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A

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X & Y are partners sharing profits in the ratio 5:3. They admitted Z for 1/5th share of profits, for which the paid Rs. 1,20,000 against capital and Rs. 60,000 against goodwill. Find the capital balances for each partners taking Z's capital as base capital.

The correct option is A 3,00,000;1,80,000 & 1,20,000New Profit sharing ratio = 1 - 1/5 = 4/5A= 5/8 * 4/5 = 20/40 ; B= 3/8 * 4/5 = 12/40 ; C= 1/5 * 8/8 = 8/40i.e. 5 ; 3 ; 2.Capitals = 120000 * 5 = 600000A - 600000 * 5/10 = 300000B - 600000 * 3/10 = 180000

X & Y are partners sharing profits in the ratio $5 : 3$ . They admitted Z for $1 / 5$ th share of profits, for which the paid Rs. $1, 20, 000$ against capital and Rs. $60, 000$ against goodwill. Find the capital balances for each partners taking Z's capital as base capital.

The correct option is A $3, 00, 000; 1, 80, 000$ & $1, 20, 000$
New Profit sharing ratio = 1 - 1/5 = 4/5
A= 5/8 * 4/5 = 20/40 ; B= 3/8 * 4/5 = 12/40 ; C= 1/5 * 8/8 = 8/40
i.e. 5 ; 3 ; 2.
Capitals = 120000 * 5 = 600000
A - 600000 * 5/10 = 300000
B - 600000 * 3/10 = 180000