question_answer

Surender, Ramesh, Naresh and Mohan are partners in a firm sharing profits in 2 : 1 : 2 : 1 ratio. On the retirement of Naresh, the goodwill was valued at Rs. 2,16,000. Surender, Ramesh and Mohan decided to share future profits equally. Pass the necessary journal entry for the treatment of goodwill without opening goodwill account.

Answer:

                                                                        JOURNAL

Date	Particulars		LF	Amt (Dr)	Amt (Cr)
	Ramesh?s Capital A/c	Dr		36,000
	Mohan?s Capital A/c	Dr		36,000
	To Naresh?s Capital A/c				72,000
	(Being Naresh?s share of goodwill adjusted to remaining partners)

            Working Note             Calculation of Gaining Ratio                         Gaining Ratio = New Share ? Old Share                         Surender \[\,=\,\frac{1}{3}-\frac{2}{6}=\frac{2-2}{6}=\frac{0}{6}\,=\,0\]                         Ramesh \[\,=\,\frac{1}{3}-\frac{1}{6}=\frac{2-1}{6}=\frac{1}{6}\]                         Mohan \[\,=\,\frac{1}{3}-\frac{1}{6}=\frac{2-1}{6}=\frac{1}{6}\]             Gaining Ratio of Ramesh and Mohan = 1 : 1 Naresh?s Share of Goodwill = \[2,16,000\times \frac{2}{6}\,=\,Rs.\,72,000\]