CBSE 2025, Compartment, Set 1

Question

A, B and C were partners in a firm sharing profits and losses in the ratio of 2:3:1. Goodwill appeared in their books at ₹3,00,000. B retired from the firm on $1^{st}$ April, 2024. On that date, the goodwill of the firm was valued at ₹5,40,000. Pass the necessary Journal entries in the books of the firm for the treatment of goodwill on B's retirement.

Edvaya · Accepted Answer

The correct answer is Subjective. **Journal Entries in the Books of the Firm** | Date | Particulars | L.F. | Dr. Amount (₹) | Cr. Amount (₹) | |---|---|---|---|---| | 2024 Apr 1 | A's Capital A/c Dr. B's Capital A/c Dr. C's Capital A/c Dr. To Goodwill A/c *(Existing goodwill written off amongst old partners in 2:3:1)* | | 1,00,000 1,50,000 50,000 | 3,00,000 | | Apr 1 | A's Capital A/c Dr. C's Capital A/c Dr. To B's Capital A/c *(B's share of goodwill adjusted in the capital accounts of A & C in their gaining ratio of 2:1)* | | 1,80,000 90,000 | 2,70,000 | **Working Notes:** 1. Old existing goodwill = ₹3,00,000 (written off in old ratio 2:3:1). 2. Valued Goodwill = ₹5,40,000. B's share of goodwill = $5,40,000 	imes 3/6 = ₹2,70,000$. Since no specific information is given, gaining ratio of A and C is 2:1. A compensates = $2,70,000 	imes 2/3 = ₹1,80,000$. C compensates = $2,70,000 	imes 1/3 = ₹90,000$.

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Accountancy > Accounting For Partnership Firms > Retirement And Death Of A Partner

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