Mohan, Girdhari and Shyam were partners in a firm sharing profits and losses in the ratio of 4 : 3 : 2. On 31st March, 2022, Girdhari retired. After making all adjustments on account of reserves, revaluation of assets and reassessment of liabilities, the balance in Girdhari’s Capital Account stood at 5,00,000. Mohan and Shyam agreed to pay Girdhari 5,90,000 in full settlement of his claim.

Calculate the value of goodwill of the firm and pass the necessary journal raising goodwill account. 

Marks-3, CBSE:2021-22/Term-2/Zone-4/Set-1/Q-5

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