Keshav, Nirmal and Pankaj are partners sharing profits and losses in the ratio of `4:3:2`. Nirmal retires and the goodwill is valued at Rs. 72,000. Keshav and Pankaj decided to share future profits and losses in the ratio of 5:3. Record necessary journal entries (a) when goodwill is raised at its full value and written off immediately (b) when goodwill is not to appear in firms books at all.

Explanation

(a) When Goodwill is raised and written-off

(b) When goodwill is not to appear in firm's books at all
Working Notes
1. Vimal's share of goodwill = Rs. `72,000xx(3)/(9)` = Rs. 24,000
2. Calculation of Gaining Ratio
Gaining Share = New Share - Old Share
Keshav's Gaining Share = `(5)/(8)-(4)/(9)=(13)/(72)`
Pankaj's Gaining Share = `(3)/(8)-(2)/(9)=(11)/(72)`
Hence. Gaining Ratio between Keshav and Pankaj is 13:11 i.e. `(13)/(24):(11)/(24)`