Z is admitted to a firm for 1 4th share in the profits for which he brings in Rs 10 000 towards...........

General Accounting Principles Partnership

Z is admitted to a firm for 1/4th share in the profits for which he brings in Rs.10,000 towards premium for goodwill. it will be taken by old partner's in

the old profit sharing ratio

the new profit sharing ratio

the sacrificing ratio

none of the above

छोटे Courses बड़े Results

Master Partnership

Prepare through Micro-courses

Try Now

Explanation:

Premium for goodwill is the additional amount brought in by the incoming partner to compensate for the loss in share of the super profits of the old partners. It is distributed among the old partners in the ratio in which they forego their shares in favour of the new partner which is called the sacrificing ratio.