Amar and Akbar are equal partners in a firm They admitted Anthony as a new partner and the new profit sharing ratio is 4:3:2-Accountancy

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Q.26. Amar and Akbar are equal partners in a firm. They admitted Anthony as a new partner and the new profit sharing ratio is 4:3:2. Anthony could not bring this share of goodwill Rs 45,000 in cash. It is decided to do adjustment for goodwill without opening goodwill account. Pass the necessary journal entry for the treatment of goodwill?

SOLUTION

Books of Amar,Akbar and Anthony

Journal

DateParticularsL.FAmount(Dr.)Amount(Cr.)
Anthony’s Capital A/cDr.45,000
   To Amar’s capital A/c11,250
   To Akbar’s capital A/c33,750
(Anthony’s share of Goodwill is taken from his capital A/c by partner Amar and Akbar in their sacrificing ratio)
Working Notes

1) Sacrificing Ratio = Old Ratio − New Ratio

Amar’s sacrificing Ratio = 1/2-4/9 = 1/8

Akbar’s sacrificing Ratio= 1/2-3/9 =3/18

Sacrificing Ratio between Amar and Akbar = 1:3

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