Commerce Exam > Commerce Questions > sand y are partners and share profits in the ...
Start Learning for Free
sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ?
? Related: New Profit Sharing Ratio
Most Upvoted Answer
sand y are partners and share profits in the ratio 3:2 .they take z as...
Treatment of Z's contribution in the books of the firm
Z was supposed to bring Rs 60,000 against capital and Rs 20,000 against goodwill. However, he was only able to bring Rs 60,000. This situation will be treated in the books of the firm as follows:
1. Calculation of new profit sharing ratio
Before we can determine how Z's contribution will be treated, we need to calculate the new profit sharing ratio. The new ratio is 1:1:1, which means that Sand, Y, and Z will share the profits equally.
2. Treatment of Z's contribution against capital
Z was supposed to bring Rs 60,000 against capital, but he was only able to bring Rs 60,000. Therefore, the firm will credit Z's capital account with Rs 60,000.
3. Treatment of Z's contribution against goodwill
Z was supposed to bring Rs 20,000 against goodwill, but he was not able to bring any amount. Therefore, the firm will not credit Z's goodwill account with any amount.
4. Adjustment of goodwill
Since Z was not able to bring any amount against goodwill, the goodwill of the firm will have to be adjusted. The new goodwill of the firm will be calculated as follows:
New goodwill = Total capital of Sand and Y * Goodwill ratio
The goodwill ratio is 2:3 (Sand's capital to Y's capital), so the new goodwill will be:
New goodwill = (3/5)*(Sand's capital + Y's capital)
The adjustment entry will be:
Goodwill account debit (with the old goodwill amount)
Sand's capital account credit (with 3/5 of the new goodwill amount)
Y's capital account credit (with 2/5 of the new goodwill amount)
In summary, Z's contribution against capital will be credited to his capital account, and no amount will be credited to his goodwill account. The goodwill of the firm will be adjusted based on the new capital contributions of Sand, Y, and Z.
Z was supposed to bring Rs 60,000 against capital and Rs 20,000 against goodwill. However, he was only able to bring Rs 60,000. This situation will be treated in the books of the firm as follows:
1. Calculation of new profit sharing ratio
Before we can determine how Z's contribution will be treated, we need to calculate the new profit sharing ratio. The new ratio is 1:1:1, which means that Sand, Y, and Z will share the profits equally.
2. Treatment of Z's contribution against capital
Z was supposed to bring Rs 60,000 against capital, but he was only able to bring Rs 60,000. Therefore, the firm will credit Z's capital account with Rs 60,000.
3. Treatment of Z's contribution against goodwill
Z was supposed to bring Rs 20,000 against goodwill, but he was not able to bring any amount. Therefore, the firm will not credit Z's goodwill account with any amount.
4. Adjustment of goodwill
Since Z was not able to bring any amount against goodwill, the goodwill of the firm will have to be adjusted. The new goodwill of the firm will be calculated as follows:
New goodwill = Total capital of Sand and Y * Goodwill ratio
The goodwill ratio is 2:3 (Sand's capital to Y's capital), so the new goodwill will be:
New goodwill = (3/5)*(Sand's capital + Y's capital)
The adjustment entry will be:
Goodwill account debit (with the old goodwill amount)
Sand's capital account credit (with 3/5 of the new goodwill amount)
Y's capital account credit (with 2/5 of the new goodwill amount)
In summary, Z's contribution against capital will be credited to his capital account, and no amount will be credited to his goodwill account. The goodwill of the firm will be adjusted based on the new capital contributions of Sand, Y, and Z.
Community Answer
sand y are partners and share profits in the ratio 3:2 .they take z as...
Bank a/c dr. 60000
to z's capital a/c. 60000
z's capital a/c dr. 20000
to s capital a/c. 16000
to y capital a/c 4000
as sacrificing ratio will be 4:1
and 20000 of premium for Goodwill will be deducted from z's current ac
to z's capital a/c. 60000
z's capital a/c dr. 20000
to s capital a/c. 16000
to y capital a/c 4000
as sacrificing ratio will be 4:1
and 20000 of premium for Goodwill will be deducted from z's current ac
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
|
Explore Courses for Commerce exam
|
|
Similar Commerce Doubts
Top Courses for CommerceView all
sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio?
Question Description
sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio?.
sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio?.
Solutions for sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? in English & in Hindi are available as part of our courses for Commerce.
Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? defined & explained in the simplest way possible. Besides giving the explanation of
sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio?, a detailed solution for sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? has been provided alongside types of sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? theory, EduRev gives you an
ample number of questions to practice sand y are partners and share profits in the ratio 3:2 .they take z as a new partner and it is supposed that he would bring rs 60000 against capital and rs 20000 against goodwill . new profit sharing ratio is 1:1:1. z is able to bring only 60000 . how this will be treated in the books of firm ? Related: New Profit Sharing Ratio? tests, examples and also practice Commerce tests.
|
|
Explore Courses for Commerce exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup