A and B are partners sharing profits in the ratio of 3 : 1. C is admitted as a partner with 2/9th share; A and B will in future get 4/9th and 3/9th share of profits. C pays ₹ 2,00,000 for goodwill. Pass the necessary journal entries

A and B are partners sharing profits in the ratio of 3 : 1. C is admitted as a partner with 2/9th share; A and B will in future get 4/9th and 3/9th share of profits. C pays ₹ 2,00,000 for goodwill. Pass the necessary journal entries.

[Ans. A sacrifices 11/36 whereas B gains 3/36 and C gains 8/36. Hence, premium for goodwill A/c will be debited by ₹ 2,00,000 and B’s Capital A/c will be debited by ₹ 75,000 and A’s Capital A/c will be credited by ₹ 2,75,000.]