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JAMB Principles of Accounts 1998 Question 35

Question 35

Partnership Admission, Retirement and Dissolution

Umar and Ahmed share profits and losses equally and have capital balances of ₦40,000 and ₦60,000 respectively. If Abdullahi purchases one-third interest with no bonus, how much will he have to contribute to the partnership?

  1. A.₦33,333
  2. B.₦40,000
  3. C.₦44,444
  4. D.₦50,000.
Show the answer and explanation

Answer: D (₦50,000.)

Explanation

New capital x must be ⅓ of (100 000 + x): 3x = 100 000 + x, so x = ₦50 000.