Bharat and Ishu were partners in a firm sharing profits and losses in the ratio of $\displaystyle 4$ : 1. Rishab was admitted into partnership for $\displaystyle 1$/4th share in the profits of the firm. Goodwill of the firm was valued at ₹ $\displaystyle 4,00$,000. Rishab brought $\displaystyle 2,00,000$ as his capital and $\displaystyle 60,000$ out O his share of oodwill remium in cash. At the time of Rishab's admission, goodwill was appearing in the books of the firm at ₹ $\displaystyle 50$,000. Pass necessary journal entries for the above transactions in the books of the firm on Rishab's admission.

OR

Sana and Rajesh were partners in a firm sharing profits and losses in the ratio of $\displaystyle 4$ : 3. They admitted Sonu into partnership for $\displaystyle 1$/5th share in the profits of the firm. Goodwill of the firm was to be valued at three ears' urchase of su or -profits. Average net profit of the firm was ₹ $\displaystyle 80$,000. Capital employed in the business was ₹ $\displaystyle 2,00,000$ and normal rate of return was $\displaystyle 10$%. Calculate the amount of goodwill premium brought by Sonu.

In the books of Bharat, Ishu and Rishabh Journal Date Particulars L.F Dr. Cr. Amount Amount (₹) (₹) Bharat’s Capital A/c Dr. $\displaystyle 40,000$ Ishu’s Capital A/c Dr. $\displaystyle 10,000$ To Goodwill A/c $\displaystyle 50,000$ (Goodwill already appearing in books written off in the old ratio) Cash A/c Dr. $\displaystyle 2,60,000$ To Rishabh’s Capital A/c $\displaystyle 2,00,000$ To Premium for Goodwill A/c $\displaystyle 60,000$ (Amount brought in by Rishabh as his capital and share of goodwill) Premium for Goodwill A/c Dr. $\displaystyle 60,000$ Rishabh’s Current A/c Dr. $\displaystyle 40,000$ To Bharat’s Capital A/c $\displaystyle 80,000$ To Ishu’s Capital A/c $\displaystyle 20,000$ (Share of Rishabh in goodwill credited to old partners in the ratio of their sacrifice) Q. (b) Sana and Rajesh were partners……… Ans. Average Net Profit= ₹$\displaystyle 80,000$ Normal Profit= Capital Employed x Normal Rate of Return = $\displaystyle 2,00,000$ x $\displaystyle 10$% = ₹$\displaystyle 20,000$…………………………………………….1 Super Profit= Average Profit- Normal Profit = $\displaystyle 80,000$- $\displaystyle 20,000$ = ₹$\displaystyle 60,000$………………………………………………$\displaystyle 1$ Goodwill of the firm= Number of years’ purchase x Super Profit = $\displaystyle 3$ x $\displaystyle 60,000$ = ₹$\displaystyle 1,80,000$…………………………………..½ Sonu’s share of Goodwill= $\displaystyle 1,80,000$ x $\displaystyle 1$/$\displaystyle 5$= ₹$\displaystyle 36,000$………………….½