When goodwill is not retained in the business, the entries in the new partners books will be to debit______________
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Correct Answer: Option D
Explanation:
When goodwill is raised in the books at full value, the entry is
 Dr Goodwill Account
 Cr Old partners capital account (old ratio)
 When the raised goodwill is written off, entry will be:
 Dr All partners capital account
 Cr Goodwill accounts
 Note: goodwill written off includes new partners in the new profit sharing ratio
When goodwill is raised in the books at full value, the entry is
 Dr Goodwill Account
 Cr Old partners capital account (old ratio)
 When the raised goodwill is written off, entry will be:
 Dr All partners capital account
 Cr Goodwill accounts
 Note: goodwill written off includes new partners in the new profit sharing ratio