Explanation
Partner
Old share
New share
Gain
Sacrifice
A
2/7
-
B
3/7
½
1/14
C
1/2
3/14
Therefore, A's share of goodwill is :
Rs. 140000 * (2/7) = Rs. 40000
Adjusting entry would be :
B's capital A/c Dr. 10000
C's capital A/c Dr. 30000
To A's capital A/c 40000
(The amount of share of goodwill adjusted on A's retirement)
Rs. 280000 * (2/7) = Rs. 80000
B's capital A/c Dr. 20000
C's capital A/c Dr. 60000
To A's capital A/c 80000
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