A new partner has joined the business during the year and has paid in 10,000 for goodwill.
Question:
A new partner has joined the business during the year and has paid in £10,000 for ‘goodwill’. This £10,000 has been credited by the bookkeeper to the account of the new partner. The senior partner had objected to this, but the bookkeeper had replied: ‘Why not credit the £10,000 to the account of the new partner? It is his money after all.’
Required:
Give your advice as to the proper treatment of this £10,000. Explain your reasons fully.
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A new partner has joined the business during the year and has paid in 10000 for goodwill This 10000 has been credited by the bookkeeper to the account of the new partner The senior partner had objecte...View the full answer
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Related Book For 
Frank Woods Business Accounting Volume 1
ISBN: 9780273681496
10th Edition
Authors: Frank Wood, Alan Sangster
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