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Question
When the incoming partner brings his share of premium for goodwill in cash, it is adjusted by crediting to ______.
Options
His Capital Account
Premium for Goodwill Account
Sacrificing Partners' Capital Accounts
None of the above
MCQ
Fill in the Blanks
Solution
When the incoming partner brings his share of premium for goodwill in cash, it is adjusted by crediting to Sacrificing Partners' Capital Accounts.
Explanation:
When the new partner does not deliver the goodwill in cash, his capital account is debited, and a premium for the Goodwill account is created.
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