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Hidden Goodwill

State 'True' ...

Question

State 'True' or 'False'

If the goodwill account raised up, goodwill account is debited.

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Solution

False

Explanation: If the goodwill account is raised, then goodwill or premium account is credited, whereas, cash/ bank account is debited if the amount is brought in cash.

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Q. State whether the following statements are true or false :

If goodwill is written off retiring partner’s capital account is debited.

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. State 'True' or 'False'

When goodwill is written off, goodwill amount is debited.

Q. When existing Goodwill is written off, is the partner's Capital Account debited or credited?

Q. If the goodwill raised at the time of retirement of a partner is to be written off, then the capital accounts of the remaining partners are debited in :

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