Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Reconstitution of Partnership Firm: Retirement and Death

Question:
In which ratio the capital accounts of partners are debited, when at the time of retirement of a partner goodwill appears in the books and it is decided to written off?
Options:
Old ratio
New ratio
Capital ratio
None of these
Correct Answer:
Old ratio
Explanation:
Existing goodwill is written-off in the old ratio by debiting all partners’ capital accounts.