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State True or False with reason. When goodwill is written off, goodwill amount is debited. - Book Keeping and Accountancy

MCQ
True or False

State True or False with reason.

When goodwill is written off, goodwill amount is debited.

Options

  • True

  • False

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Solution

This statement is False.

Explanation: 

If old (or existing) goodwill appears in the books of a firm, then at first, it is written off by debiting the Old Partners’ Capital Accounts in their old profit sharing ratio and crediting the Goodwill Account.

  Is there an error in this question or solution?
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APPEARS IN

Micheal Vaz Accounts - Book Keeping and Accountancy HSC 12th Standard Maharashtra State Board
Chapter 3 Reconstitution of Partnership (Admission of Partner)
Exercise | Q 9 | Page 108
Balbharati Book-keeping and Accountancy 12th Standard HSC Maharashtra State Board
Chapter 3 Reconstitution of Partnership (Admission of Partner)
Exercise 3 | Q 1. (C) 7. | Page 159
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