Question : When goodwill existing in the books is written off at the time of admission of a partner it is transferred to Partners' Capital Accounts in their
Option 1: Old profit-sharing ratio
Option 2: New profit-sharing ratio
Option 3: Sacrificing ratio
Option 4: Gaining ratio
Correct Answer: Old profit-sharing ratio
Solution : Answer = Old profit-sharing ratio If a new partner brings his share of goodwill in cash, and if the Goodwill Account already appears in the books of the firm, first of all, the existing Goodwill Account will have to be written off. For this purpose old Partner's Capital Accounts are debited in their old profit-sharing ratio and the Goodwill Account is credited. Hence, the correct option is 1.
Question : When a new partner is admitted the balance of 'General Reserve' appearing in the Balance Sheet at the time of admission is credited to
Question : At the time of admission of a partner, what will be the effect of the following information? Balance in Workmen compensation reserve Rs. 28,000. Claim for workmen compensation Rs. 20,000.
Question : At the time of admission of a partner, what will be the effect of the following information? Balance in Workmen compensation reserve Rs. 1,40,000. Claim for workmen compensation Rs. 1,10,000.
Question : Cake and Muffin are partners sharing profits and losses in the ratio of 5: 4. On 1st April, 2016, they admit Cookie as a new partner for 1/6th share in the profits of the firm and the new ratio agreed upon is 3: 2: 1.
Goodwill, at the time of Cookie's admission is
Question : At the time of admission of a partner, what will be the effect of the following information? Balance in Workmen compensation reserve Rs. 20,000. Claim for workmen compensation Rs. 45,000.
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