What enteries will be made if goodwill is not brought in cash by new partner, recorded in the books and immediately written off
What enteries will be made if goodwill is not brought in cash by new partner, recorded in the books and immediately written off
If Goodwill is not brought by new partner then it will adjusted throgh his capital account.
Goodwill a/c Dr
To Old partners (Old Ratio)
All partners capital a/c (Including new partner) new ratio DR
To Goodwill account
Or a single entry can be passed
New partner's capital account DR
to Old partners cappital A/c (Secrifice ratio)
please let me know if you have any question.
CAclubindia
