Partnership

Admission

Medium

A, B and C are partners in a firm sharing profits in the ratio of 3:2:1. D is admitted into the firm for 1/4th share in profits, which he gets as 1/8th from A and 1/8th from B. The total capital of the firm is agreed upon as Rs. 1,20,000 and D is to bring in cash equivalent to 1/4th of this amount as his capital. The capitals of other partners are also to be adjusted in the ratio of their respective shares in profits. The capitals of A, B and C after all adjustments are Rs. 40,000, Rs. 35,000 and Rs. 30,000 respectively.

C will withdraw the capital amount after capital are adjusted in the ratio of their respective shares in profits. The amount is:

Rs. 20,000

Rs. 15,000

Rs. 10,000

Rs. 5,000

✅ Correct Option: 3

Finding D's share and new profit sharing ratio:

D gets 1/4th share by taking:

1/8 from A
1/8 from B

Old ratio of A:B:C = 3:2:1 (total 6 parts)

A's old share = 3/6 = 1/2, B's old share = 2/6 = 1/3, C's old share = 1/6

After D's admission:

A's new share = 1/2 - 1/8 = 3/8
B's new share = 1/3 - 1/8 = 5/24
C's new share = 1/6 (unchanged)
D's new share = 1/4

Converting to ratio with common denominator 24:

A = 9/24
B = 5/24
C = 4/24
D = 6/24

New profit sharing ratio = 9:5:4:6

Capital adjustment:

Total capital of firm = Rs. 1,20,000

C's required capital based on new ratio = $\frac{4}{24} \times 1,20,000$ = Rs. 20,000

C's actual capital after adjustments (given) = Rs. 30,000

Amount C will withdraw = Rs. 30,000 - Rs. 20,000 = Rs. 10,000

Since C's actual capital (Rs. 30,000) exceeds the required capital (Rs. 20,000) based on the new profit sharing ratio, C needs to withdraw the excess amount.

2026: 23 May Shift 2

For transferring the revaluation loss, which of the following is correct ?

2026: 12 May Shift 1

In adjustment of capital during admission of a partner, certain steps are followed. Arrange them in a sequence:

(A) Calculation of new profit sharing ratio

(B) Calculate required capitals of old partners

(D) Calculate firm's capital

Choose the correct answer from the options given below:

2025: 14 May Shift 1

Which Factor does not Affect the Value of Goodwill:

2026: 13 May Shift 1

When a new partner is entered into firm, goodwill already appeared in books of accounts of firm, should be written off in which of the following.

2025: 30 May Shift 2

Rohit and Mohit are partners in a firm sharing profits in the ratio of 5:3. They admitted Bijoy as a new partner for 1/7th share in the profit. The new profit sharing ratio will be 4:2:1. What will be the sacrificing ratio of Rohit and Mohit?

2024

Kavita and Lalita are partners, sharing profits in the ratio of 2:1. They decide to admit Mohan for 1/4th share in profits with a guaranteed amount of ₹ 25,000. Both Kavita and Lalita undertake to meet the liability arising due to the guaranteed amount to Mohan in their respective profit sharing ratio. The firm earned profits of ₹ 76,000 for the year 2022-23. The deficiency borne by Kavita is:

C will withdraw the capital amount after capital are adjusted in the ratio of their respective shares in profits. The amount is:

Solution

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