12th Class Accountancy Admission of a Partner Question Bank MCQs - Reconstitution Of a Partnership Firm : Admission of a Partner

X and Y are partners sharing profits in the ratio of 3 : 1. They admit Z as a partner who pays Rs. 4,000 as goodwill, the new profit sharing ratio being 2 : 1 : 1 among X, Y and Z. The amount of goodwill will be credited to:

A) X and Y as Rs. 3,000 and Rs. 1,000

B) Rs. 2,000 each

C) only Y

D) only X

Correct Answer: D

Solution :

[d] only X

Hint: Sacrificing Ratio = Old Share - New Share

X's sacrifice = \[\frac{3}{4}-\frac{2}{4}=\frac{1}{4}\] Y's sacrifice = \[\frac{1}{4}-\frac{1}{4}\] Nil

Here, only X sacrifices. So, goodwill will be credited in X's capital account only.