Question

P, Q and R are partners sharing profits and losses in the ratio of 5 : 3: 2. P died on 30th June, 2026. P’s share in the goodwill of the firm is calculated as half the amount credited to his account in the previous three years as profit. Profits for last 3 years were ₹ 50,000; ₹ 60,000; ₹ 70,000.

Journal entry for P’s share of goodwill will be:

Options

• P’s Capital A/c   ....Dr.	45,000	-
  To Q’s Capital A/c	-	27,000
  To R’s Capital A/c	-	18,000

• Q’s Capital A/c   ....Dr.	22,500	-
  R’s Capital A/c   ....Dr.	22,500	-
  To P’s Capital A/c	-	45,000

• Q’s Capital A/c   ....Dr.	27,000	-
  R’s Capital A/c   ....Dr.	18,000	-
  To P’s Capital A/c	-	45,000

• P’s Capital A/c   ....Dr.	45,000	-
  To Q’s Capital A/c	-	22,500
  To R’s Capital A/c	-	22,500

Answer 1

Q’s Capital A/c   ....Dr.	27,000	-
R’s Capital A/c   ....Dr.	18,000	-
To P’s Capital A/c	-	45,000

Explanation:

Total profit for the last 3 years = ₹ 50,000 + ₹ 60,000 + ₹ 70,000

= ₹ 1,80,000

Amount credited to P’s account `5/10` share

= `1,80,000 xx 5/10`

= ₹ 90,000

P’s Share of Goodwill:

It is half of the profit credited to his account = `(90,000)/2`

= ₹ 45,000

Remaining partners Q and R contribute this ₹45,000 in their gaining ratio of 3 : 2:

Q’s debit share = `45,000 xx 3/5`

= ₹ 27,000

R’s debit share = `45,000 xx 2/5`

= ₹ 18,000