P, Q and R are Partners sharing Profits and losses equally. R retires and Goodwill is appearing in the books at ₹30,000. Goodwill of the firm is valued at ₹1,50,000. Calculate the net amount to be credited to R's Capital A/c for adjustment of goodwill:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → ₹40,000
Goodwill already in the books is first written off among all partners in the old ratio; then the retiring partner is credited with his share of the firm’s goodwill, borne by the gaining partners.
Existing goodwill written off:
R’s share = ₹30,000 × 1/3 = ₹10,000 (debited to R)
R’s share of goodwill:
= ₹1,50,000 × 1/3 = ₹50,000 (credited to R)
Net amount credited to R’s Capital A/c:
= ₹50,000 − ₹10,000
= ₹40,000