Accountancy
Goodwill
Goodwill, or साख, is the intangible value a partnership firm earns through its reputation, customer loyalty, business connections, location and ability to generate profits above the normal return. In Class 12 Accountancy, students learn why goodwill is valued when partners are admitted, retire, or change their profit-sharing ratio. The topic introduces the basic ideas behind average profit, super profit and capitalisation methods, along with the need to adjust partners’ capital accounts fairly.
Expert · Level 6 · 11 questions