Question 27 of 28
Q.State whether the following statement is True or False:
When goodwill is paid privately, its entry in the books of accounts is not required.
(a) True
(b) False
Maharashtra MsbshseMaharashtra HSC (MSBSHSE) Board 2020MCQ· 1mImportance★★★★★
96% · 27/28 Questions
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Start your 14-day free trial to unlock the full solution →Goodwill paid privately is a transaction outside the firm's books, so no journal entry is passed in the firm's books; the statement is true.
When the incoming partner pays his share of goodwill privately (cash paid directly to the old partners rather than being brought into the firm), the money never …
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