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Question
Solution
False
Explanation:
Goodwill is the value of a firm's reputation, its good brand name and favourable contacts in the market. It cannot be seen or touched like other assets of the firm. It does not have any physical existence. It just has a capability to help the business in earning more and more profits. On the contrary, fictitious assets are neither tangible nor intangible assets. They are the expenses or losses which are still to be charged (debited) from the profit. They all have a debit balance and cannot be considered as assets of the firm.
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Answer in one sentence only.
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Write the word/term or phrase which can substitute the following statement.
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Account which is credited when goodwill is withdrawn by old partners.
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Explain various methods for the treatment of goodwill on the admission of a new partner?
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