Page 3 - LN

ii.) Pre for goodwill A/c Dr ( in sacrifice ratio)
To Old partners’ capital A/c

b.) When goodwill/premium brought in by the new partner is withdrawn by
the old partners:-

i.) Old Partners’ capital A/c Dr.
To Cash / Bank A/c

When goodwill already appears in the books and new partners brings his
share of goodwill/premium in cash:-

First of all the existing goodwill account will have to be written off. For this
purpose old partners’ capital accounts are debited in old ratio and goodwill
account is credited.

Old partners’ capital A/c Dr.
To goodwill A/c ( in old ratio)

Remaining entries remains same for bring goodwill in cash.

When the new partner does not bring his share of goodwill/premium in cash:-

New partner’s current A/c Dr. (from his share of goodwill)
To old partners’ capital A/c (in sacrifice ratio)

When goodwill already appears in the books and new partner does not bring
his share of goodwill/premium in cash:-

i.) Old partners’ capital A/c Dr.

To goodwill A/c (in old ratio)

ii.) New partner’s current A/c Dr.
To old partner’s capital A/c (in sacrifice ratio )

When new partner brings in only a part of his share of goodwill:-

i.) Cash/bank A/c Dr.