CUET Preparation Today
| If the new partner brings goodwill in cash and also a balance of goodwill exists in the balance sheet, then this existing goodwill is written off among the old partners in which ratio? |
Old ratio New ratio Sacrificing ratio Gaining ratio |
| Old ratio |
| When a new partner is admitted, goodwill of the business is valued afresh. For this, the goodwill that already appears in the books of accounts is written off and is transferred to the old partner's capitals accounts in their old profit-sharing ratio. The old partner's capital accounts are debited with their share of goodwill. |
