CBSE 2025, Set 2

Question

(b) Vijay, Ravi and Raman were partners in a firm sharing profits and losses in the ratio of 5:3:2. On 1st April, 2024, they admitted Kamal as a new partner for 1/10th share in the profits. It was decided that new profit sharing ratio will be 4:2:3:1. On Kamal's admission, the goodwill of the firm was valued at ₹6,00,000. Kamal brought his share of goodwill premium in cash.
(i) Calculate the sacrificing ratio.
(ii) Pass necessary journal entries for the treatment of goodwill on Kamal's admission.
Show your working notes clearly.

Edvaya · Accepted Answer

The correct answer is Subjective. **(i) Calculation of Sacrificing Ratio:** Sacrificing share = Old share - New share Vijay = 5/10 - 4/10 = 1/10 (Sacrifice) Ravi = 3/10 - 2/10 = 1/10 (Sacrifice) Raman = 2/10 - 3/10 = -1/10 (Gain) Sacrificing ratio of Vijay and Ravi is **1:1**, while Raman is gaining. **(ii) Journal Entries:** Goodwill of firm = ₹ 6,00,000. Kamal's share of goodwill premium = 1/10 × 6,00,000 = ₹ 60,000. Raman's gain requires compensation = 1/10 × 6,00,000 = ₹ 60,000. Total compensation to Vijay & Ravi = 60k (from Kamal) + 60k (from Raman) = 1,20,000, distributed equally (1:1), so 60k each. | Date | Particulars | L.F. | Dr. Amount (₹) | Cr. Amount (₹) | |---|---|---|---|---| | 2024 Apr 1 | Cash A/c Dr.     To Premium for goodwill A/c (Cash brought in by Kamal) | | 60,000 | 60,000 | | Apr 1 | Premium for goodwill A/c Dr. Raman's Capital A/c Dr.     To Vijay's Capital A/c     To Ravi's Capital A/c (Premium and Raman's gain credited to Vijay and Ravi) | | 60,000 60,000 | 60,000 60,000 |

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Accountancy > Accounting For Partnership Firms > Admission Of A Partner

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