The incoming partner brings the amount of goodwill in Cash and also a balance exists in goodwill account. The goodwill appearing in the books is written off among which of the following?
Answer & explanation
Correct answer: option 1
If the incoming partner brings premium for goodwill in cash and goodwill already exists in the books of the firm, this goodwill that already exists in the books of the firm is distributed among the existing partners in their old profit sharing ratio.