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Question -

Sangeeta, Saroj and Shanti are partners sharing profits in the ratio of 2:3:5. Goodwill is appearing in the books at a value of Rs 60,000. Sangeeta retires and goodwill is valued at Rs 90,000. Saroj and Shanti decided to share future profits equally. Record necessary Journal entries.



Answer -

 Books of Saroj and Shanti

Journal

 

Date

Particulars

L.F.

Amount

Rs

Amount

Rs

 

Sangeeta’s Capital A/c

Dr.

 

12,000

 

 

Saroj’s Capital A/c

Dr.

 

18,000

 

 

Shanti’s Capital A/c

Dr.

 

30,000

 

 

To Goodwill A/c

 

 

60,000

 

(Goodwill written off)

 

 

 

 

 

 

 

 

 

Saroj’s Capital A/c

Dr.

 

18,000

 

 

To Sangeeta’s Capital A/c

 

 

 

18,000

 

(Sangeeta’s share of goodwill adjusted to Saroj’s Capital

Account in her gaining ratio)

 

 

 
Working Notes:
 
1. Sangeeta’s share of goodwill.
Total goodwill of the firm x Retiring Partner’s share  
2. Gaining Ratio = New Ratio – Old Ratio
Saroj’s Gaining Share  
Shanti’s Gaining Share  

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