Partners D and E share profits in the ratio 5:3. A new partner F is admitted. The existing partners agree to give F goodwill of Rs. 24,000 in their old profit‑sharing ratio. How much goodwill will be transferred from partner D to F?
Answer
Rs. 15,000
The correct answer is Rs. 15,000 — Step 4: Conclude that Rs. 15,000 of goodwill will be transferred from partner D to F.
Step-by-step solution
- Step 1: Calculate total parts of the old profit‑sharing ratio: 5 + 3 = 8 parts.
- Step 2: Compute the value of one part of goodwill: Rs. 24,000 ÷ 8 = Rs. 3,000 per part.
- Step 3: Find D’s share: 5 parts × Rs. 3,000 = Rs. 15,000.
- Step 4: Conclude that Rs. 15,000 of goodwill will be transferred from partner D to F.
Common mistake: Adding the shares of both partners instead of allocating goodwill proportionally
Concept tested: Goodwill transfer to new partner
Published · How this solution was prepared and checked
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