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Mohit and Govind were partners in a firm with a ratio of 1:2. They admitted Ravi for 1/5th share in profits. He brought ₹2,50,000 for capital but could not bring goodwill. The goodwil -

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Question

Mohit and Govind were partners in a firm with a ratio of 1:2. They admitted Ravi for 1/5th share in profits. He brought ₹2,50,000 for capital but could not bring goodwill. The goodwill of the firm was valued at ₹3,00,000. What Journal Entry will be passed for the treatment of goodwill?

Options

  • Asset A/c Dr.     60,000
           To Ravi's Capital A/c                   60,000
  • Cash A/c Dr.      60,000
         To Goodwill A/c 60,000
  • Mohit's Capital A/c Dr.   20,000
    Govind's Capital A/c Dr.   40,000
           To Ravi's Capital A/c 60,000
  • Ravi's Capital A/c Dr.    60,000
         To Mohit's Capital A/c                 20,000
         To Govind's Capital A/c                40,000
MCQ

Solution

Ravi's Capital A/c Dr.    60,000
     To Mohit's Capital A/c                 20,000
     To Govind's Capital A/c                40,000

Explanation:

Ravi's goodwill share will be divided among the sacrificing partners according to the sacrificing ratio.

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