Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Admission of a Partner

Question:

While calculating goodwill of the partnership firm, outstanding expenses are........... from the total assets to calculate capital employed.

Options:

Added

Deducted

No use of outstanding expenses in capital employed

None of the above

Correct Answer:

Deducted

Explanation:

Capital employed= Total asset- outside liabilities
And outstanding expenses are an outside liability.