Gobind, Hari, and Pratap are partners. On the retirement of Gobind, the goodwill already appears in the books at ₹24,000. The goodwill will be written off
By debiting all the partner capital accounts in old profit-sharing ratio
When goodwill already exists in the books and a partner retires, it is written off by debiting all partners’ capital accounts in the old profit-sharing ratio.
Thus, the correct answer is: By debiting all the partner capital accounts in old profit-sharing ratio.
Important Questions from Reconstitution of a Partnership : Retirement/Death of a Partner
The Deceased Partner’s Capital Account includes the following amounts/balances:
(A) Opening balance of his capital
(B) His share of profit/loss till the date of death
(C) His share of General Reserve
(D) His drawings till the date of death
(E) Amount paid to his executors
Choose the correct answer from the options given below:
A, B and C are partners sharing profits in the ratio of 3 : 2 : 1. C died on 1st July, 2023. On this date, final accounts were prepared to ascertain profits for the period. It resulted in a profit of ₹ 1,75,000 to the firm. To give effect to the above:
In the absence of any information regarding the acquisition of share in profit of the retiring partner by the remaining partners, it is assumed that they will acquire his/her share in:
Profit and Loss Suspense Account is debited at the time of death of partner.
In case of retirement, a retiring partner is entitled to get:
A. Share in profits made by the firm after his retirement
B. His share of Goodwill
C. His share in Accumulated Reserve
D. Share in Employees Provident Fund
Choose the correct answer from the options given below:
