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Hidden Goodwill

State 'True' ...

Question

State 'True' or 'False'

The goodwill brought in by the new partner is shared by all partners.

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Solution

False

Explanation: Goodwill brought in by the new partner is shared only by the old partners in their sacrificing ratio. The new partner has no right on goodwill brought in by him.

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Similar questions

Q. State 'True' or 'False'

The goodwill brought in by a new partner is shared by the old partners.

Q. Share of goodwill brought in cash by the new partner is shared by the old partners _________.

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

On the death of a partner, his share in the goodwill is divided equally among continuing partners.

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'

The new partner must pay his share of goodwill in cash only.

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