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Question
Jaya, Kirti, Ekta and Shewta are partners in the firm sharing profits and losses in the ratio of 2:1:2:1. On Jaya's retirement, the goodwill of the firm is valued at Rs. 36,000. Kirti, Ekta and Shewta decided to share future profits equally. What will be the necessary journal entry for the treatment of goodwill without opening a 'Goodwill Account'.
Options
Kirti's Capital A/c Dr (6000) Shweta's Capital A/c Dr (6000) To Jaya's Capital A/c (12000).
Kirti's Capital A/c Dr (8000) Shweta's Capital A/c Dr (8000) To Jaya's Capital A/c (16000).
Kirti's Capital A/c Dr (9000) Shweta's Capital A/c Dr (9000) To Jaya's Capital A/c (18000).
None of these
Solution
Kirti's Capital A/c Dr (6000) Shweta's Capital A/c Dr (6000) To Jaya's Capital A/c (12000).
Explanation:
The value of Jaya's goodwill has been changed to maintain its gaining ratio.
