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Old goodwill of (₹30000) appears in books and new goodwill is valued at (₹90000). If the question does not ask to open Goodwill Account, what is the first step?

Answer and explanation

Correct answer: Write off old goodwill in old ratio

Existing old goodwill is first removed in old ratio. New goodwill is raised only if the question instructs so.

Related tags

Old GoodwillExam TreatmentGoodwill AccountGoodwill AccountingReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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