Question :

Which of the following statement is correct?

Option 1:

Goodwill at the time of retirement of a partner is credited to remaining Partners’ Capital Accounts in sacrificing ratio.

Option 2:

Goodwill at the time of retirement of a partner is credited to remaining Partners’ Capital Accounts in gaining ratio.

Option 3: Goodwill at the time of retirement of a partner is debited to remaining Partners' Capital Accounts in sacrificing ratio.

Option 4:

Goodwill at the time of retirement of a partner to the extent of retiring Partner's Share is debited to remaining Partners’ Capital Accounts in gaining ratio.