Discussion
X and Y share profits and losses in the ratio of 2 : 1. They take Z as a partner and the new profit sharing ratio becomes 3 : 2 : 1. Z brings ₹ 4,500 as premium for goodwill. What will be the value of firm’s goodwill ?
Answer: C
The value of the firm's goodwill is ₹ 27,000.
In the new ratio 3 : 2 : 1, Z's share is 1/6. The premium he brings is his share of the firm's goodwill.
\[ \begin{aligned} \tfrac{1}{6} \times G &= 4{,}500 \\ G &= 4{,}500 \times 6 = 27{,}000 \end{aligned} \]
₹ 4,500 is only Z's share, not the firm's goodwill. ₹ 18,000 treats Z's share as 1/4, and ₹ 24,000 does not correspond to Z's 1/6 share at all.
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