Question : What would be closing entry for goodwill given in balance sheet at the time of dissolution of a partnership firm?
Option 1: Goodwill Alc
To Partner's Capital Alc
Option 2: Goodwill Alc Dr.
To Realisation A/C
Option 3: Realisation Alc Dr.
To Goodwill Alc
Option 4: Partner's Capital Alc Dr.
To Goodwill A/C
Answer (1)
9th Jan, 2024
Correct Answer:
Realisation Alc Dr.
To Goodwill Alc
Solution : Goodwill is an asset. It will be recorded on the debit side of the Realisation Account. Hence the correct option is 3.
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