P, Q, R and S were partners in a firm sharing profits in the ratio of 5 : 3 : 1 : 1. On 1st January, 2023, S retired from the firm. On S’s retirement, goodwill of the firm was valued at ₹ 4,20,000. New Profit sharing ratio among P, Q and R will be 4 : 3 : 3. Showing your working notes clearly, pass necessary Journal entry for the treatment of goodwill in the books of the firm on S’s retirement.
P, Q, R and S were partners in a firm sharing profits in the ratio of 5 : 3 : 1 : 1. On 1st January, 2023, S retired from the firm. On S’s retirement, goodwill of the firm was valued at ₹ 4,20,000. New Profit sharing ratio among P, Q and R will be 4 : 3 : 3.
Showing your working notes clearly, pass necessary Journal entry for the treatment of goodwill in the books of the firm on S’s retirement.
Anurag Pathak Changed status to publish June 15, 2023
