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Sacrificing ratio or profit sharing ratio.

Accountancy

1)How do we know we need to use sacrificing ratio or profit sharing ratio for sharing Goodwill. 2)In some questions sacrificing ratio is used and in some questions profit sharing ratio is used for sharing Goodwill.

ALDRIN G

CA Inter

★ 12K+

27-Oct-20 16:54

302

Answers (2)

There are two approaches One - Credit in old profit sharing and debit in new profit sharing second - directly use sacrifice ratio Final impact will be the same.