What is meant by ‘Profitability of Business’? Post category:Accountancy Reading time:1 mins read SOLUTION ‘Profitability of Business’ refers to the earning capacity of the business. Please Share This Share this content Opens in a new window X Opens in a new window Facebook Opens in a new window Pinterest Opens in a new window LinkedIn Opens in a new window Viber Opens in a new window VK Opens in a new window Reddit Opens in a new window Tumblr Opens in a new window Viadeo Opens in a new window WhatsApp Read more articles Previous PostWhat is Working Capital? Next PostWhat is meant by Profitability Ratios? You Might Also Like What is the nature of ‘Revaluation Account’? September 26, 2022 When is dividend received considered as operating activity? October 6, 2022 Ram, Laxman and Bharat are partners sharing profits in the ratio of 3: 2: 1. Goodwill is appearing in the books at a value of Rs. 1,80,000. Laxman retires and at the time of his retirement, goodwill is valued at Rs. 2,52,000. Ram and Bharat decided to share future profits in the ratio of 2 : 1. The Profit for the first year after Laxman’s retirement amount to Rs. 1,20,000. Give the necessary Journal entries to record goodwill and to distribute the profit. Show your calculations clearly. August 3, 2022 Leave a Reply Cancel replyYou must be logged in to post a comment.
Ram, Laxman and Bharat are partners sharing profits in the ratio of 3: 2: 1. Goodwill is appearing in the books at a value of Rs. 1,80,000. Laxman retires and at the time of his retirement, goodwill is valued at Rs. 2,52,000. Ram and Bharat decided to share future profits in the ratio of 2 : 1. The Profit for the first year after Laxman’s retirement amount to Rs. 1,20,000. Give the necessary Journal entries to record goodwill and to distribute the profit. Show your calculations clearly. August 3, 2022