C, R & S are partners sharing profits in the ratio of 5:3:2. R retires, the new profit sharing ratio between C & S will be 1:1. The goodwill of the firm is valued at ₹1,00,000. R's share of goodwill be adjusted:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → By debiting only S's Capital account with ₹30,000
The retiring partner’s share of goodwill is borne by the continuing partners in their gaining ratio.
C’s gain = 1/2 − 5/10 = 0
S’s gain = 1/2 − 2/10 = 3/10
R’s share of goodwill = ₹1,00,000 × 3/10 = ₹30,000
Only S gains, so S’s Capital Account is debited with ₹30,000 and R’s Capital Account credited.
NCERT (2026-27 edition):
NCERT (2026-27 edition):
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