L, M and N are three partners sharing profits in the ratio of 4 : 3 : 2 respectively. M retires and the goodwill is valued at ₹ 1,08,000. No goodwill account appears as yet in the books of the firm

L, M and N are three partners sharing profits in the ratio of 4 : 3 : 2 respectively. M retires and the goodwill is valued at ₹ 1,08,000. No goodwill account appears as yet in the books of the firm. L and N will share profits in future in the ratio of 5 : 3 respectively. Pass Journal Entry for goodwill.

[Ans. M’s share of goodwill will be adjusted to the Capital A/cs of L and N in their Gaining Ratio 13 : 11.]