Assertion (A): At the time of Change in Profit-Sharing Ratio, Gaining Partner brings his share of Goodwill to compensate the Sacrificing Parnter.
Assertion (A): At the time of Change in Profit-Sharing Ratio, Gaining Partner brings his share of Goodwill to compensate the Sacrificing Parnter.
Reason (R): Goodwill may or maynot be brought in cash by the Gaining Partner to compensate the sacrificing partner for sacrificing his profit share.
in the context of above two statements, which of the following is correct?
a) Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of Assertion (A)
b) Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)
c) Only Assertion (A) is correct
d) Both Assertion (A) and Reason (R) are incorrect.
Anurag Pathak Changed status to publish May 5, 2023
Ans – a)
Explanation:-
At the time of change in profit sharing ratio, gaining partner brings his share of goodwill to compensate the sacrificing partner. Thus, Assertion is correct.
The gaining partner may or may not brings goodwill in cash to compensate the sacrificing partner. Thus Reason (R) is correct.
But Reason (R) is not the correct explanation of Assertion (A).
Anurag Pathak Changed status to publish May 5, 2023
