Question

Anchal, Prabhat and Karan were partners in a firm sharing profits and losses in the ratio of 3 : 2 : 1. On 31st March, 2025, Anchal retired. The balance in her capital account after making the necessary adjustments on account of reserves and revaluation of assets and reassessment of liabilities was ₹ 5,10,000. Anchal was paid ₹ 5,90,000 in full settlement of her claim. The value of goodwill of the firm on the date of Anchal’s retirement was :

• A. ₹ 80,000
• B. ₹ 5,10,000
• C. ₹ 5,90,000
• D. ₹ 1,60,000

Hint:

On retirement, if the amount paid to retiring partner exceeds their capital balance (after all adjustments), the excess represents their share of goodwill. \[ \text{Total Goodwill} = \frac{\text{Excess Amount}}{\text{Retiring Partner's Share}} \] Remember: The excess is the retiring partner's share of goodwill, not the total goodwill!

Answer 1

The Correct Option is D