Page 137 - DEBKVOL-1

6.4 Double Entry Book Keeping—CBSE XII
Solution: JOURNAL

Date Particulars L.F. Dr. (`) Cr. (`)
2017 X’s Capital A/c ...Dr. 19,500
April 1 Z‘s Capital A/c ...Dr. 16,500
To Y‘s Capital A/c 36,000
(Y‘ s share of goodwill adjusted in the Capital Accounts of
gaining partners in their gaining ratio, i.e., 13 : 11)

Bank A/c (` 1,08,000 × 3/20) ...Dr. 16,200
To Premium for Goodwill A/c 16,200
(Amount of goodwill brought in by W for purchased share of profit, i.e., 3/20)

Premium for Goodwill A/c ...Dr. 16,200
To X‘s Capital A/c 8,100
To Z’s Capital A/c 8,100
(Goodwill credited to sacrificing partners in their sacrificing ratio, i.e., 1 : 1)

2018 Profit and Loss Appropriation A/c ...Dr. 50,000
March 31 To X’s Capital A/c 20,000
To Z’s Capital A/c 15,000
To W’s Capital A/c 15,000
(Profit credited to all partners in their new profit-sharing ratio, i.e., 4 : 3 : 3)
Working Notes:
1. Calculation of Gaining Ratio of X and Z:

5 4 13 3 2 11
X‘s Gain = - = ; Z’s Gain = - =
8 9 72 8 9 72
13 11
Hence, Gaining Ratio of X and Z = : = 13 : 11.
72 72
2. Calculation of New Ratio of X, Z and W:
X Z
A. New Share after Y‘s retirement: 5/8 3/8
B. Gifted by X = 1/2 of 3/10 = 3/20
C. Share acquired by W (other than gift):
From X = 1/2 of 3/20 = 3/40
From Z = 1/2 of 3/20 = 3/40
5 3 3 25 – 6 – 3 16
D. New Share of X (after W’s admission) = – – = =
8 20 40 40 40
3 3 15 – 3 12
New Share of Z (after W’s admission) = – = =
W’s Share = 3/10 8 40 40 40
16 12 3
New Ratio of X, Z and W = : : = 16 : 12 : 12 or 4 : 3 : 3.
40 40 10