Treatment of Goodwill in Admission of a Partner.

P and Q are partners sharing profit and loss in the ratio of 3:2. They admit R into the firm for 3/7 share in profits which he takes 2/7 from P and 1/7 from Q. R brings Rs.30000 as his share of goodwill and Rs.100000 as capital. Give journal entries and also calculate new profit sharing ratio....please Sir

asked Apr 12, 2016 in Partnership-Fundamentals by Faizan (28 points) 1,116 views

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Note: In the absence of information as to withdrawal of goodwill amount, it is assumed that P and Q did not withdraw the amount of goodwill.

answered Apr 12, 2016 by jbsclasses (3,971 points) u distribute the goodwill among old partners ...sir give me the working note....and thanks for the reply
Goodwill is distributed in the ratio of sacrifice made by P and Q.  Please note in the question it is mentioned that R becomes partner for 3/7 share which he takes 2/7 from P and 1/7 from Q.    Sacrificing ratio of P and Q is 2/7 : 1/7 that is, 2 : 1.  So the amount of goodwill brought by R is distributed between P and Q in the ratio 2:1.