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easyMCQCUET Accountancy 2025 16 May Shift 12026CUET Accountancy
1 mark

Valuation of goodwill is NOT required in which of the following scenarios?

  1. A
    Change in profit sharing ratio among existing partners
  2. B
    Admission of a new partner
  3. C
    Retirement of a partner
  4. D
    Purchase of raw materials from a vendor

Solution & Step-by-step Explanation

Recomputing the value of goodwill is necessary during partnership reconstitutions (admission, retirement, death, change in profit-sharing ratio, or amalgamation) because the profit-sharing structure changes. Conversely, purchasing raw materials is a routine trading transaction that has no connection with evaluating the firm's brand valuation or intangible goodwill.

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Valuation of goodwill is NOT required in which of the following scenarios?
A
Change in profit sharing ratio among existing partners
B
Admission of a new partner
C
Retirement of a partner
D
Purchase of raw materials from a vendor

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