Tarun, Abhishek, Kamal and Vivek were partners in a firm sharing profits in the ratio of 5:3:2:2. Kamal retired on 31st March, 2022. Tarun, Abhishek and Vivek decided to share future profits equally. On Kaal’s retirement goodwill of the firm was valued at 9,00,000.

Showing your working clearly, pass the necessary journal entry for treatment of goodwill on Kamal’s retirement. It was decided not to show goodwill in the books of the firm.

Marks-3, CBSE:2022-23/Zone-5/Set-1/Q-19*

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