When goodwill existing in the books is written off at the time of admission of a partner, it is transferred to Partner’s Capital Accounts in their.
When goodwill existing in the books is written off at the time of admission of a partner, it is transferred to Partner’s Capital Accounts in their.
a) Old Profit Sharing Ratio
b) New Profit Sharing Ratio
c) Sacrificing Ratio
d) Gaining Ratio
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Ans – a)
Explanation:-
Existing Goodwill was purchased before the admission of the new partner. Thus it must be written off in the old profit-sharing ratio at the time of admission of the new partner.
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