ram and shyam are partners sharing p&l in the ratio 4 : 1. They agreed to admit mohan into the partnership on 1st april 2017 for 1/3 share in profits . It was agreed that Ram, Shyam and mohan would share profits equally in the future. Mohan brought in 50000 as goodwill ( premium ) for his 1/3 share in profits. Pass journal entries.

Dear Student,




 

Journal

PARTICULARS	DEBIT AMOUNT	CREDIT AMOUNT
Cash a/c Dr.                                                       To Premium for goodwill	50000	50000
Premium for goodwill a/c Dr.                             To Ram's capital a/c	50000	50000
Shyam's Capital a/c Dr.                                    To Ram's Capital a/c	20000	20000

​​​​​​
$$\begin{gathered} Ram\text{'}s Scarificing portion- \\ old PSR-New PSR \\ \frac{4}{5}-\frac{1}{3}= \frac{12-5}{15}=\frac{7}{15} \\ Shyam\text{'}s gaining portion- \\ old PSR-New PSR \\ \frac{1}{5} -\frac{1}{3}=\frac{3-5}{15}=\frac{-2}{15} (as the portion is negative, it signifies gain) \\ Mohan\text{'}s gaining portion=\frac{1}{3} \end{gathered}$$     






​​​​​​Ram is the sacrificer of  7/15 share. out of this 1/3 is the  gaining portion of the newly admitted partner- Mohan , and rest 2/15 is the gaining portion of existing partner Shyam.


Mohan bought goodwill rs.50000 for 1/3 share. calculate goodwill of the whole firm.
1/3= rs.50000
therefore, 1= rs.1,50,000
so, calculate Ram's share of sacrifice due to gain of shyam.
therefore, 2/15 of 150000 = rs.20,000.


Regards.