X, Y and Z were partners in a firm sharing profits in the ratio of 3 : 2 : 1. X retired and the new profit sharing ratio between Y and Z will be 5 : 4. On X's retirement the goodwill of the firm was valued at ₹54,000. Journal entry will be :
Answer & explanation
Correct answer: option 3
The correct answer is option 3-
Y's Capital A/c Dr. ₹12,000
Z's Capital A/c Dr. ₹15,000
To X's Capital A/c ₹27,000
Gain of Y = 5/9 - 2/6
= (10-6)/18
= 4/18
Gain of Z = 4/9 - 1/6
= (8-3)/18
= 5/18
Gaining Ratio = 4:5
Share of Goodwill of X = 54,000 x 3/6
= 27,000
Y's Capital A/c is debited with = 27,000 x 4/9
= 12,000
Z's Capital A/c is debited with = 27,000 x 5/9
= 15,000
So, the following journal entry is passed for this-
Y's Capital A/c Dr. 12,000
Z's Capital A/c Dr 15,000
To X's Capital A/c 27,000