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Commerce · Q2260

Accounting

Graduate and Post Graduate · Commerce · question 2260

Q2260

A and B are partners sharing profits in the ratio of 3 : 2. Their books showed goodwill at Rs. 3,000. C is admitted with 1/4^ th share of profits and brings Rs. 10,000 as his capital. But, he is not able to bring in cash for his share of the goodwill of Rs. 3,000. How will you treat this?

A and B are partners sharing profits in the ratio of 3 : 2. Their books showed goodwill at Rs. 3,000. C is admitted with share of profits and brings Rs. 10,000 as his capital. But, he is not able to bring in cash for his share of the goodwill of Rs. 3,000. How will you treat this?
A.
Goodwill is raised by Rs. 12,000
B.
C will remain as debtor for Rs. 3,000
C.
C's account is debited by Rs. 3,000
D.
Goodwill is raised by Rs. 9,000
Answer

Answer: Option D

Solution

Answer: Option D
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