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If a new partner brings only half of his goodwill premium in cash what is the usual accounting treatment of the remaining half?

Answer and explanation

Correct answer: It will be debited to new partner's capital or current account

Unbrought goodwill is treated as recoverable from the new partner. Therefore his capital or current account is debited.

Related tags

GoodwillUnbrought-GoodwillAdmissionTreatmentPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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