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What is the most important difference between writing off old goodwill and adjusting new goodwill?

Answer and explanation

Correct answer: Old goodwill is written off in old ratio and new goodwill is adjusted in sacrificing ratio

Old goodwill belongs to the old firm so it is written off in old ratio. Admission goodwill compensates sacrifice so it goes in sacrificing ratio.

Related tags

Old GoodwillNew GoodwillComparisonGoodwill AccountingReconstitution Admission Of A PartnerAccountancyClass 12 Mcq

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