Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Dissolution of Partnership Firm

Question:

On dissolution of partnership, goodwill account is transferred to:

Options:

The debit side of Realisation Account

The credit side of Realisation Account

The credit side of Partner's Capital/Current Account

The debit side of Partner's Capital/Current Account

Correct Answer:

The debit side of Realisation Account

Explanation:

Goodwill does not have any special treatment in dissolution. It should be treated like any other asset. If it already appears in books, it will be transferred, like all other assets, to the debit side of Realisation Account.