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The deed says old goodwill will not be shown in books but new partner will pay premium. Which adjustment does this indicate?

Answer and explanation

Correct answer: Premium to old partners in sacrificing ratio

Even if goodwill is not shown in books the premium may be given to old partners. The basis is sacrificing ratio.

Related tags

Goodwill PremiumSacrificing RatioAdmissionPartnership DeedPartnership Accounts Basic ConceptsAccountancyClass 12 Mcq

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