answer this question of death of a partner
Dear Student
Working Note
WN1: Calculation of Share in General Reserve
Reserve= 36,000 × 5/12= Rs15,000
WN2: Calculation of Interest on Capital
Interest on capital = 3,00,000 x 10/100 x 6/12 = 15000
WN3: Calculation of Profit & Loss Suspense
Profit & Loss Suspense = 1,80,000x 5/12 x6/12 = 37500
WN4: Calculation of Share in Goodwill
Gaining Ratio New Ratio = New ratio - Old Ratio
Y's Gain =7/12- 4/12 = 3/12 ( gain)
Z's Gain = 5/12- 3/12= 2/12 ( gain)
Goodwill= Average Profit × No. of years Purchase= 1,80,000x2.5 = RS 4,50,000
X's share in Goodwill= 4,50,000 × 5/12 = Rs1,87,500 should be contributed by Y & Z in gaining ratio i.e. 3:2
Regards
Working Note
WN1: Calculation of Share in General Reserve
Reserve= 36,000 × 5/12= Rs15,000
WN2: Calculation of Interest on Capital
Interest on capital = 3,00,000 x 10/100 x 6/12 = 15000
WN3: Calculation of Profit & Loss Suspense
Profit & Loss Suspense = 1,80,000x 5/12 x6/12 = 37500
WN4: Calculation of Share in Goodwill
Gaining Ratio New Ratio = New ratio - Old Ratio
Y's Gain =7/12- 4/12 = 3/12 ( gain)
Z's Gain = 5/12- 3/12= 2/12 ( gain)
Goodwill= Average Profit × No. of years Purchase= 1,80,000x2.5 = RS 4,50,000
X's share in Goodwill= 4,50,000 × 5/12 = Rs1,87,500 should be contributed by Y & Z in gaining ratio i.e. 3:2
Regards