Gce Model Questions Vol1 2019 Financial Accounting Question 26
Practice objective / multiple choice question 26 from the 2019 Gce Model Questions Vol1 Financial Accounting examination.
A partnership of A and B has a profit‑sharing ratio of 3:2. Their opening capital balances are A \(£120,000\) and B \(£80,000\). At the beginning of the year the partnership values goodwill at \(£60,000\). New partner C is admitted, acquiring a \(\frac15\) share of future profits and contributing \(£30,000\) cash. The partners agree that goodwill will be shared between the existing partners in their old profit‑sharing ratio and that C will pay cash for his share of goodwill. An equipment revaluation later increases assets by \(£10,000\), to be shared equally between A and B. Calculate the opening capital balance of each partner after C's admission and the revaluation.
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About This Question
This is Gce Model Questions Vol1 2019 Financial Accounting Question 26. It is one of the objective questions from the 2019 Gce Model Questions Vol1 Financial Accounting examination.
Difficulty level: Hard .
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