[amp_mcq option1=”new profit sharing ratio” option2=”old profit sharing ratio” option3=”sacrificing ratio” option4=”none of the above” correct=”option3″]<\/p>\n
The correct answer is: C. sacrificing ratio.<\/p>\n
When goodwill is raised in the books, the capital accounts of the old partners are credited in the sacrificing ratio. This is because the old partners are sacrificing their capital to pay for the goodwill. The sacrificing ratio is the ratio in which the old partners agree to share the goodwill.<\/p>\n
Option A is incorrect because the new profit sharing ratio is not used to credit the capital accounts of the old partners. The new profit sharing ratio is used to determine how the profits and losses of the business will be shared after the goodwill has been raised.<\/p>\n
Option B is incorrect because the old profit sharing ratio is not used to credit the capital accounts of the old partners. The old profit sharing ratio is used to determine how the profits and losses of the business were shared before the goodwill was raised.<\/p>\n
Option D is incorrect because the answer is C. sacrificing ratio.<\/p>\n","protected":false},"excerpt":{"rendered":"
[amp_mcq option1=”new profit sharing ratio” option2=”old profit sharing ratio” option3=”sacrificing ratio” option4=”none of the above” correct=”option3″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[85],"tags":[],"class_list":["post-59165","post","type-post","status-publish","format-standard","hentry","category-accounting","no-featured-image-padding"],"yoast_head":"\n