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When Goodwill Exist in the Business

On retirement...

Question

On retirement, the capital account of the retiring partner shall be credited with ……….

A

None of the above

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B

share of goodwill of remaining partners

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C

goodwill of the firm

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D

his share of goodwill

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Solution

The correct option is D
his share of goodwill

On retirement, the capital account of the retiring partner shall be credited with his/her share of goodwill.

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Similar questions

Retiring partner’s share of goodwill is credited to his/her capital account at the time of retirement. State true of false.

Q. When required amount for premium for goodwill is not brought in by new partner, goodwill account is raised in the books of the firm by debiting goodwill account and crediting partners capital account in old profit sharing ratio and written off in ______ if it agreed not show goodwill in the books of the firm OR ALTERNATIVELY premium for goodwill should be adjusted through partners capital account by debiting new partners share of goodwill to his account and crediting old partners capital accounts in _________.

Q. Retiring Partners share of goodwill is debited to remaining partners in their _________.

Q. (When one of the Remaining Partners also sacrifices in addition to the Retiring Partner). X,Y and Z were partners sharing profits in the ratio of 3:2:1. Z retired and the new profit-sharing ratio between X and Y was 1:2. On Z's retirement, goodwill of the firm was valued at RS.30,000. Pass necessary Journal entries for the treatment of goodwill on Z's retirement without opening the Goodwill Account.

Q. Select the most appropriate answer from the alternatives given below :

If the goodwill is raised to the extent of retiring partners share ___________ account is to be debited.
a) cash
b) goodwill
c) all partner’s capital
d) retiring partners capital

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