Gce Model Questions Vol1 2017 Financial Accounting Question 13

Three partners A, B and C share profits in the ratio 3:2:1. Their original capital balances are A \(\text{₦}150,000\), B \(\text{₦}100,000\) and C \(\text{₦}50,000\). A new partner D is admitted, paying \(\text{₦}84,000\) for a 20% share of the partnership. At the same time the partnership revalues a building whose original cost is \(\text{₦}200,000\) with accumulated depreciation \(\text{₦}50,000\); its market value is now \(\text{₦}240,000\). Goodwill of \(\text{₦}30,000\) is also recognised. Goodwill and the revaluation surplus are shared among the existing partners in the profit‑sharing ratio. The cash paid by D is less than the value of his 20% share, the difference being treated as a bonus to the existing partners, also shared in the profit‑sharing ratio. Determine (a) the bonus each existing partner receives and (b) the final capital balances of A, B, C and D after D's admission.