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A and b partner in a firm sharing profit and losses in the ratio 2 ratio 1 they admitted c into partnership on the condition that he will bring 21000 as good will share for one port share in profit assuming that Goodwill has been bought in cash by c pass necessary journal entries when first Goodwill is paid privately s Goodwill is written in the form of old partner third half Goodwill is withdrawn by old partners?
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A and b partner in a firm sharing profit and losses in the ratio 2 rat...
Journal Entries for Admission of C into Partnership
Introduction
When a new partner is admitted into a partnership firm, certain accounting entries need to be made to record the transaction. In this scenario, A and B are partners in a firm sharing profit and losses in the ratio of 2:1. They have admitted C into partnership on the condition that he will bring 21000 as goodwill share for one part share in profit. We need to pass necessary journal entries when the first Goodwill is paid privately, the Goodwill is written in the form of old partner, and one-third of the Goodwill is withdrawn by old partners.
Payment of Goodwill Privately
When C pays the Goodwill amount privately, the following journal entry needs to be made:
Goodwill A/c Dr. 21000
To C’s Capital A/c 21000
Here, the Goodwill account is debited as it is an intangible asset and C’s Capital account is credited as he has contributed to the firm’s capital.
Goodwill Written in the Form of Old Partner
When Goodwill is credited to the old partners' accounts in the ratio of their sacrificing ratio, the following journal entry needs to be made:
C’s Capital A/c Dr. 21000
To A’s Capital A/c 14000
To B’s Capital A/c 7000
Here, C’s Capital account is debited as he is the one who has paid the Goodwill amount, and A and B’s Capital accounts are credited in the ratio of their sacrificing ratio.
Withdrawal of One-Third of Goodwill by Old Partners
When one-third of the Goodwill is withdrawn by old partners, the following journal entry needs to be made:
A’s Capital A/c Dr. 7000
B’s Capital A/c Dr. 3500
To Goodwill A/c 10500
Here, A and B’s Capital accounts are debited in the ratio of 2:1 as per their profit-sharing ratio, and the Goodwill account is credited.
Conclusion
In conclusion, when a new partner is admitted into a partnership firm, certain accounting entries need to be made to record the transaction. In this scenario, we have seen how necessary journal entries are made when the first Goodwill is paid privately, the Goodwill is written in the form of old partner, and one-third of the Goodwill is withdrawn by old partners.
Introduction
When a new partner is admitted into a partnership firm, certain accounting entries need to be made to record the transaction. In this scenario, A and B are partners in a firm sharing profit and losses in the ratio of 2:1. They have admitted C into partnership on the condition that he will bring 21000 as goodwill share for one part share in profit. We need to pass necessary journal entries when the first Goodwill is paid privately, the Goodwill is written in the form of old partner, and one-third of the Goodwill is withdrawn by old partners.
Payment of Goodwill Privately
When C pays the Goodwill amount privately, the following journal entry needs to be made:
Goodwill A/c Dr. 21000
To C’s Capital A/c 21000
Here, the Goodwill account is debited as it is an intangible asset and C’s Capital account is credited as he has contributed to the firm’s capital.
Goodwill Written in the Form of Old Partner
When Goodwill is credited to the old partners' accounts in the ratio of their sacrificing ratio, the following journal entry needs to be made:
C’s Capital A/c Dr. 21000
To A’s Capital A/c 14000
To B’s Capital A/c 7000
Here, C’s Capital account is debited as he is the one who has paid the Goodwill amount, and A and B’s Capital accounts are credited in the ratio of their sacrificing ratio.
Withdrawal of One-Third of Goodwill by Old Partners
When one-third of the Goodwill is withdrawn by old partners, the following journal entry needs to be made:
A’s Capital A/c Dr. 7000
B’s Capital A/c Dr. 3500
To Goodwill A/c 10500
Here, A and B’s Capital accounts are debited in the ratio of 2:1 as per their profit-sharing ratio, and the Goodwill account is credited.
Conclusion
In conclusion, when a new partner is admitted into a partnership firm, certain accounting entries need to be made to record the transaction. In this scenario, we have seen how necessary journal entries are made when the first Goodwill is paid privately, the Goodwill is written in the form of old partner, and one-third of the Goodwill is withdrawn by old partners.
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A and b partner in a firm sharing profit and losses in the ratio 2 rat...
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A and b partner in a firm sharing profit and losses in the ratio 2 ratio 1 they admitted c into partnership on the condition that he will bring 21000 as good will share for one port share in profit assuming that Goodwill has been bought in cash by c pass necessary journal entries when first Goodwill is paid privately s Goodwill is written in the form of old partner third half Goodwill is withdrawn by old partners?
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A and b partner in a firm sharing profit and losses in the ratio 2 ratio 1 they admitted c into partnership on the condition that he will bring 21000 as good will share for one port share in profit assuming that Goodwill has been bought in cash by c pass necessary journal entries when first Goodwill is paid privately s Goodwill is written in the form of old partner third half Goodwill is withdrawn by old partners? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A and b partner in a firm sharing profit and losses in the ratio 2 ratio 1 they admitted c into partnership on the condition that he will bring 21000 as good will share for one port share in profit assuming that Goodwill has been bought in cash by c pass necessary journal entries when first Goodwill is paid privately s Goodwill is written in the form of old partner third half Goodwill is withdrawn by old partners? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A and b partner in a firm sharing profit and losses in the ratio 2 ratio 1 they admitted c into partnership on the condition that he will bring 21000 as good will share for one port share in profit assuming that Goodwill has been bought in cash by c pass necessary journal entries when first Goodwill is paid privately s Goodwill is written in the form of old partner third half Goodwill is withdrawn by old partners?.
A and b partner in a firm sharing profit and losses in the ratio 2 ratio 1 they admitted c into partnership on the condition that he will bring 21000 as good will share for one port share in profit assuming that Goodwill has been bought in cash by c pass necessary journal entries when first Goodwill is paid privately s Goodwill is written in the form of old partner third half Goodwill is withdrawn by old partners? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A and b partner in a firm sharing profit and losses in the ratio 2 ratio 1 they admitted c into partnership on the condition that he will bring 21000 as good will share for one port share in profit assuming that Goodwill has been bought in cash by c pass necessary journal entries when first Goodwill is paid privately s Goodwill is written in the form of old partner third half Goodwill is withdrawn by old partners? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A and b partner in a firm sharing profit and losses in the ratio 2 ratio 1 they admitted c into partnership on the condition that he will bring 21000 as good will share for one port share in profit assuming that Goodwill has been bought in cash by c pass necessary journal entries when first Goodwill is paid privately s Goodwill is written in the form of old partner third half Goodwill is withdrawn by old partners?.
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