Which of the following method is followed when incoming partner brings his share of Goodwill in cash___________.
A
Premium Method
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B
Revaluation Method
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C
Realisaton Method
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D
None of Above
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Solution
The correct option is A Premium Method Incoming partner who acquires his share in the profits of the firm from the existing partners brings in some additional amount to compensate them for loss of their share in super profits. It is termed as his share of goodwill (also called premium).