Admission Of Partner

Answer

Admission of a partner refers to the process where a new person is inducted into an existing partnership firm. This requires the consent of all existing partners and leads to the reconstitution of the…

Answer

The firm is reconstituted because the admission changes the profit-sharing ratio, rights, and obligations of all partners. A new partnership deed is created, and all financial adjustments like goodwil…

Answer

Sacrificing Ratio is the ratio in which existing partners give up their share of profit in favor of the new partner. It is calculated as: **Sacrificing Ratio = Old Profit Sharing Ratio – New Profit …

Answer

When only the new partner's share is given, it is assumed that the remaining profit is shared by the old partners in their existing ratio. **Steps:** 1. Subtract the new partner's share from 1 to get…

Answer

**Given:** - Old Ratio (A:B) = 3:2 - C's share = 1/5 - Sacrifice by A and B = 1/10 each (since 1/5 ÷ 2) **Calculation:** - A's new share = 3/5 – 1/10 = 6/10 – 1/10 = 5/10 - B's new share = 2/5 – 1/10…

Answer

Goodwill is the intangible value of a firm's reputation that enables it to earn higher profits than normal. It represents the capitalized value of super profits (actual profit minus normal profit). Go…

Answer

1. **Location** – Central or high-footfall locations increase goodwill. 2. **Nature of Business** – Stable or high-value businesses have higher goodwill. 3. **Management Efficiency** – Well-managed fi…

Answer

In the Average Profit Method, goodwill is calculated as: **Goodwill = Average Profit × Number of Years Purchase** Average profit is computed from past years' profits after adjusting for abnormalitie…