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Vera and Ken are partners who have shared profits and losses equally. On 1 July 2005 they decide to change

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Vera and Ken are partners who have shared profits and losses equally. On 1 July 2005 they decide to change the profit-sharing ratio to: Vera 3/5 and Ken 2/5. The partnership assets and liabilities at book values at 1 July 2005 are as follows.

The partners have been informed that the value of the business as a going concern is $300 000 and have decided to value Goodwill on this figure. 


Required 

(a) Calculate the value of Goodwill. 

(b) Calculate the amounts to be credited to the partners' Capital accounts for Goodwill.

Transcribed Image Text:

Premises Fixtures and fittings Motor vehicles Office equipment Stock Debtors ekitain Bank Creditors $ Gil 140 000 65.000 35 000 15 000 6 500 W Mrity 11 800 3 620 5 830

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a To calculate the value of Goodwill you need to find the excess of the total value of the business …View the full answer


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Accounting A Level And AS Level

Accounting A Level And AS Level

ISBN: 9780521539937

1st Edition

Authors: Harold Randall

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Question Details
Chapter # 22- Partnership changes
Section: Exercises
Problem: 2
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Question Posted: August 28, 2023 13:51:56
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