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When a new partner brings no goodwill in cash and goodwill is not to be kept in books how are old partners compensated?

Answer and explanation

Correct answer: By debiting new partners capital or current account and crediting old partners

Even if cash is not brought the new partner can be charged for goodwill. Old partners are credited in sacrificing ratio.

Related tags

GoodwillUnbrought-GoodwillAdmissionJournal-EntryPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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