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P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2?
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P , R ,S are in partnership ratio are 4:3:1 respectively. partnership ...
Adjustment of Goodwill on the Death of R
Journal Entry:
R's Capital A/c Dr. To Goodwill A/c
Explanation:
On the death of R, his share of goodwill needs to be calculated as per the partnership deed. As per the deed, R's share of goodwill will be 1/2 of the net profit credited to his account during the last 4 completed years. Therefore, the calculation of R's share of goodwill will be as follows:
Net Profit for 4 years = 1,20,000 + 60,000 - 20,000 + 80,000 = Rs. 2,40,000
R's Share of Net Profit = 2,40,000 x 3/8 = Rs. 90,000
R's Share of Goodwill = 1/2 x 90,000 = Rs. 45,000
As per the partnership ratio, P, R, and S are in partnership ratio of 4:3:1 respectively. Therefore, P's share of R's goodwill will be 4/8 x 45,000 = Rs. 22,500 and S's share of R's goodwill will be 1/8 x 45,000 = Rs. 5,625.
As per the future profit sharing ratio between P and S, which is 3:2, the new profit sharing ratio will be as follows:
P's Share of Profit = 3/5
S's Share of Profit = 2/5
Therefore, the adjustment of goodwill will be made in the following manner:
R's Capital A/c Dr. 45,000
To P's Capital A/c 22,500
To S's Capital A/c 22,500
To adjust R's share of goodwill as per the partnership ratio and future profit sharing ratio.
Conclusion:
The above journal entry will adjust R's share of goodwill as per the partnership ratio and future profit sharing ratio between P and S. The calculation of R's share of goodwill is based on the net profit credited to his account during the last 4 completed years as per the partnership deed.
Journal Entry:
R's Capital A/c Dr. To Goodwill A/c
Explanation:
On the death of R, his share of goodwill needs to be calculated as per the partnership deed. As per the deed, R's share of goodwill will be 1/2 of the net profit credited to his account during the last 4 completed years. Therefore, the calculation of R's share of goodwill will be as follows:
Net Profit for 4 years = 1,20,000 + 60,000 - 20,000 + 80,000 = Rs. 2,40,000
R's Share of Net Profit = 2,40,000 x 3/8 = Rs. 90,000
R's Share of Goodwill = 1/2 x 90,000 = Rs. 45,000
As per the partnership ratio, P, R, and S are in partnership ratio of 4:3:1 respectively. Therefore, P's share of R's goodwill will be 4/8 x 45,000 = Rs. 22,500 and S's share of R's goodwill will be 1/8 x 45,000 = Rs. 5,625.
As per the future profit sharing ratio between P and S, which is 3:2, the new profit sharing ratio will be as follows:
P's Share of Profit = 3/5
S's Share of Profit = 2/5
Therefore, the adjustment of goodwill will be made in the following manner:
R's Capital A/c Dr. 45,000
To P's Capital A/c 22,500
To S's Capital A/c 22,500
To adjust R's share of goodwill as per the partnership ratio and future profit sharing ratio.
Conclusion:
The above journal entry will adjust R's share of goodwill as per the partnership ratio and future profit sharing ratio between P and S. The calculation of R's share of goodwill is based on the net profit credited to his account during the last 4 completed years as per the partnership deed.
Community Answer
P , R ,S are in partnership ratio are 4:3:1 respectively. partnership ...
P capital Dr. 12000
s capital Dr. 33000
To r capital. 55000
s capital Dr. 33000
To r capital. 55000
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P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2?
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P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2?.
P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2?.
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P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2?, a detailed solution for P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2? has been provided alongside types of P , R ,S are in partnership ratio are 4:3:1 respectively. partnership deed that on the death of any partner his share of goodwill is to be 1/2 of the net profit credited to his account during the last 4 completed years.R died on 1/4/2018. the firm's profit for the last 4 years were: 2015 (profits ₹120000) 2016 (profit ₹60000) 2017 (losses 20,000) and 2018 (profit 80000).Pass journal entry for the adjustment of goodwill assuming that profit sharing ratio between p and S is in future will be 3:2? theory, EduRev gives you an
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