X and Y are partners sharing profits in the ratio of 5 : 3. Z is admitted as a partner for 3/10th share of profit, half of which was gifted by X and remaining share was taken by Z equally from X and Y. The goodwill of the firm is valued at ₹ 54,000. Z brings in his requisite share of firm’s goodwill. The profit for the first year of new partnership amounts to ₹ 60,000.
Pass the necessary Journal entries to adjust goodwill and to distribute profits.
Solution :
