Which of the following statement is correct?
Which of the following statement is correct?
a) Goodwill at the time of retirement of a partner is credited to remaining Partner’s Capital Account in their sacrificing ratio.
b) Goodwill at the time of retirement of a partner is credited to remaining Partner’s Capital Accounts in their gaining ratio.
c) Goodwill at the time of retirement of a partner is debited to remaining partners’ Capital Accounts in their new profit sharing ratio.
d) Goodwill at the time of retirement of a partner to the extent of retiring Partner’s share is debited to remaining Partner’s capital accounts in their gaining ratio.
Anurag Pathak Changed status to publish July 2, 2023
Ans – d)
Explanation:-
As goodwill is part of the expected future profits that would be earned on the basis of the partner’s efforts till date. Thus retiring partners’ share in the goodwill is credited to him. This share is compensated by the remaining partners in their gaining ratio.
Anurag Pathak Changed status to publish July 2, 2023
