Question

When goodwill is written off, goodwill A/c is debited to all partner capital account in new profit sharing ratio. (State True or False)

Answer 1

true is the answer to the question

Answer 2

Answer:

True

Explanation:

When goodwill is written off, goodwill A/c is debited to all partner capital account in new profit sharing ratio. - True

If it is decided that goodwill should not be refrained and shown in the reconstituted firm's balance sheet then the raises goodwill of its value will be credited to all the equity accounts of the partners including those of the retired or the deceased partners. It will then be written off by debiting the remaining partners in their new profit-sharing ratio and crediting the goodwill account with its complete value.