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At the time of admission of a new partner, the estimated total capital is ₹2,50,000 and the actual total capital is ₹2,20,000. What is the value of hidden goodwill?

Answer and explanation

Correct answer: ₹30,000

Hidden goodwill = Estimated total capital − Actual total capital. Therefore, ₹2,50,000 − ₹2,20,000 = ₹30,000, so option A is correct. ₹4,70,000 is the sum of the two amounts, not their difference. Exam tip: when goodwill is not stated separately, hidden goodwill is calculated as the difference between the estimated total capital and the actual total capital.

Related tags

Hidden GoodwillGoodwill AccountingCapital CalculationAdmission Of PartnerReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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