At the time of admission of a new partner, in which ratio is the old goodwill already appearing in the books written off?

Correct answer: Old ratio

Goodwill already recorded in the books belongs to the old partners. On admission of a new partner, it is written off among the old partners in their old profit-sharing ratio. Therefore, the old ratio is correct; the new ratio is incorrect because it includes the incoming partner. Exam tip: Existing goodwill is written off in the old partners’ old ratio.