X, Y and Z were partners sharing profits in ratio of 5 : 3 : 2. Goodwill does not appear in the books, but it is agreed to be worth Rs 1,00,000. X retires from the firm and Y and Z decide to share future profits equally. X’s share of goodwill will be debited to Y’s and Z’s capital account in ratio :
A. 1/2 : 1/2
B. 2 : 3
C. 3 : 2
D. None of these
Answer:B
X, Y and Z were partners sharing profits in ratio of 5 : 3 : 2. Goodwill does not appear in the books, but it is agreed to be worth Rs 1,00,000. X retires from the firm and Y and Z decide to share future profits equally. X’s share of goodwill will be debited to Y’s and Z’s capital account in ratio :
A. 1/2 : 1/2 B. 2 : 3 C. 3 : 2 D. None of these