Usha and Disha are partners sharing profits in the ratio of 2:1. Usha's son Ashish was admitted for 1/4th share of which 1/8th was gifted by Usha to her son and the remaining was contributed by Disha. The goodwill of the firm is valued at Rs. 40,000. How much of the premium for goodwill will be credited to the old partners' capital account in case of admission of Ashish.
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Rs. 5,000 each
The premium brought for goodwill belongs to the partners who gave up part of their share, and it is divided between them in the sacrificing ratio — not in the old ratio, and not equally by default.
- Ashish is admitted for 1/4. Usha gives 1/8 of it, so Disha gives the rest: 1/4 − 1/8 = 1/8.
- Sacrificing ratio of Usha and Disha = 1/8 : 1/8 = 1 : 1
- Goodwill of the firm = Rs. 40,000, so the share attached to Ashish’s 1/4 = 1/4 × 40,000 = Rs. 10,000
- Divided 1 : 1 → Rs. 5,000 to Usha and Rs. 5,000 to Disha
Usha’s 1/8 is described as a gift to her son, but she has still given up that much of her own share, and the division follows what each partner gave up.
Note: This is NCERT’s own “Test your Understanding” question, and the book prints the answer to it as well.
NCERT Extract
