Question

What journal entry will be recorded for writing off the goodwill already existing in Balance Sheet at the time of retirement of a partner?

Options

• Retiring Partner's Capital A/c     Dr.
     To Goodwill A/c

• All Partner's Capital A/c (including retiring) (in old ratio)    Dr.
      To Goodwill A/c

• Remaining Partners' Capital A/c    Dr.
  (in gaining ratio)
     To Goodwill A/c

• Remaining Partners' Capital A/c    Dr.
  (in new ratio)
     To Goodwill A/c

Answer 1

All Partner's Capital A/c (including retiring) (in old ratio)    Dr.
    To Goodwill A/c