In partnership accounts at the time of new partner admission will he really bring cash in to the firm as good will. and also what does exactly premium account and goodwill account means at that time.
2 Replies
Roshan A
(Chartered Accountant)
(458 Points)
Replied 20 November 2011
Goodwill is actually FUTURE MAINTAINABLE PROFITS DUE TO PAST AFFORTS.....yes the new partner admitted does bring in cash(share in goodwill) to be shared by the old partners as per the arrangement....
shwetha
(CWA learner)
(447 Points)
Replied 21 November 2011
thq Roshan. "Goodwill is actually FUTURE MAINTAINABLE PROFITS DUE TO PAST AFFORTS" is a very good explanation in one sentence. thq.
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