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easyMCQCUET Accountancy 2025 27 May Shift 22026Accountancy
1 mark

A, B and C are partners in a firm. If C retires/dies, his capital account is credited with:

  1. A
    His share of goodwill
  2. B
    Goodwill of the firm
  3. C
    Share of goodwill of A
  4. D
    Share of goodwill of B

Solution & Step-by-step Explanation

When a partner leaves the firm due to retirement or death, they sacrifice their profit share in favor of the continuing partners. Therefore, they are compensated by crediting their capital account with exactly their personal share of goodwill, which is debited from the gaining partners' capital accounts.

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A, B and C are partners in a firm. If C retires/dies, his capital account is credited with:
A
His share of goodwill
B
Goodwill of the firm
C
Share of goodwill of A
D
Share of goodwill of B

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