Answered: Why a retiring/deceased partner is…

Business

Accounting

Why a retiring/deceased partner is entitled to a share of goodwill of thefirm.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter15: Partnership Accounting

Section: Chapter Questions

Problem 3PA: When a partnership is liquidated, any gains or losses realized by the sale of noncash assets are...

See similar textbooks

Related questions

Q: Prior to the creation of a partnership, the sole proprietor must first re-evaluate or adjust its…

A: Re-evaluation or Adjustment in Assets or Liability: To determine whether or not there was a net gain…

Q: Determine the gross estate under the following property relationships: 1. Conjugal partnership of…

A: The term "gross estate" refers to the gross value at the time of death before any liabilities are…

Q: ould on

A: Partnetship is an agreement between two or more person in which they have agreed to run the business…

Q: The consideration which a new partner pays to the old partners for the right to participate in the…

A: WHEN NEW PARTNER IS ADMITTED INTO PARTNERSHIP . THE NEW PARTNER BRING SOME CONSIDERATION WHICH IS…

Q: What is the difference between the dissolution of a partnership and the liquidation of partnership…

A: Liquidation of partnership: Liquidation of partnership is the process of selling all the…

Q: Which of the following, if unpaid, is to be accrued? O Cash dividends O Service-type warranties O…

A: Solution: "Bonus to employees and partners of a partnership" is to accrued if unpaid.

Q: Explain the effect of dissolution on the authority and liability of the partners and the order in…

A: Partnership according to section 3 (1) of the partnership act 1961 is known as the relation between…

Q: What value should be assigned to non-cash assets transferred by one of the partners to the…

A: Partnership: It is the collaboration of two or more people to carry out a commercial venture to…

Q: limited partner as to the contribution of profits? Article 1856.

A: Partnership is the form of Business firm where two or more partners shares profits and losses in…

Q: How are general partners usually compensated in a syndication?

A: Answer: Generally, the main benefit of limited partnership ownership form for real estate…

Q: In a partnership liquidation, the final cash distribution to the partners should be made in…

A: Partnership: It can be defined as an agreement whereby two or more persons agree to conduct a…

Q: What is the JE to record the admittance of Dunn into the partnership using the goodwill (or…

A: Partnership is formed by either two or more than two person who start the business which is based on…

Q: In the liquidation of a partnership, the gains and losses from assets sold are O divided equally…

A: Solution: In the liquidation of partnership, the gain and losses from assets sold "Divided amount…

Q: What is the purpose of the qualified business income deduction under 199A? How is the deduction…

Q: Write the various matters that need adjustments at the time of retirementof a partners.

A: When one or more partners of a firm leaves the firm and the remaining partners continue the…

Q: If a partner contributes depreciable or amortizable property to the partnership, how is the basis of…

A: Partnership is an agreement between two or more than two partners who invest capital and run…

Q: When a partner withdraws assets from a partnership that is considered as a permanent withdrawal, it…

A: Partnership is one of the form of business organisation under which two or more than two persons…

Q: After liquidating all property and paying partnership obligations, what is the basis for allocating…

A: Partnership: A partnership is an unincorporated form of business which is formed by an agreement,…

Q: How would one compute the proposed value of an acquired interest if a person acquires a stake in a…

A: Definition This kind of corporate entity is created by an agreement and is jointly owned and managed…

Q: What is the appropriate measurement basis for a non-cash asset contributed by a partner in a…

A: Non-Cash Contribution by partners in partnership firm: If one or more partners contribute the…

Q: community property of the spouses Property inherited by the husband before marriage Winnings…

A: any income or any real or personal property that has been acquired by either of the sposes during…

Q: Under what circumstance might goodwill be allocated to a new partner entering a partnership?

A: Partnership: This is the form of business entity that is formed by an agreement, owned and managed…

Q: The first step in the liquidation of a partnership is to * allocate a gain or loss on realization to…

A: Introduction: Partnership: Its an agreement between two or more partners for forming a business and…

Q: How do loans from partners affect the distribution of assets in a partnership liquidation?

A: Partnership: This is the form of business entity which is formed by an agreement, owned and managed…

Q: 1. On the death of a partner, which among the following are debited to the account of the deceased…

A: Partnership: It is a type of business form. Under this business form, two or more individuals…

Q: If the amount due to a retiring partner is not paid off immediately, then that amount will be…

A: Partnership is an agreement between two or more persons in which they invest capital, run business…

Q: How does a newly formed partnership handle the contribution of previously depreciated assets?

A: A partnership is a form of business organization under which two or more than two join together to…

Q: What is hidden goodwill? How is it adjusted on the admission of a partner?

A: Hidden Goodwill means the value of goodwill that is not specified at the time of admission of a…

Q: The accounting treatment for the sale of the interest of the retiring partner to an outsider or…

A: The retirement of the partner means the partner that is leaving the partnership. The partner can…

Q: What provisions in a partnership agreement can be used to establish an equitable allocation of…

A: Partnership: A partnership is an unincorporated form of business which is formed by an agreement,…

Q: Blue and Grey are discussing how income and losses should be divided in a partnership they plan to…

A: Partnership A partnership is an arrangement between 2 or more people to administrate business…

Q: How does a newly formed partnership handle the contribution of previously depreciated assets?A.…

A: When you donate a depreciable asset to a partnership, the partnership inherits your basis,…

Q: In determining changes to a partner's outside basis, which of the following statements is false? All…

A: The basis in a partnership firm can be inside or outside. The key difference is that inside basis is…

Q: Define each of the following terms: Will Estate Intestate Probate laws Trust Inter vivos trust…

A: All of these terms related to estates and trusts Definitions: 1. Will: It is a legal written…

Q: List down the adjusted assets and liabilities of each partner to determine partner's capital.

A: The question is related to Partnership Accounting. The question is related to merger of two sole…

Q: Why is it important to state all partnership assets in terms of current prices at the time of the…

A: Partnership: It is a form of an organization which is owned and managed by two or more persons who…

Q: A partner who contributes money or property to a common fund

A: Solution: A partner who contributes money or property to a common fund is "Capitalist partner". This…

Q: How are “advances or drawings of money or property against a partner’s distributive share of income”…

A: The answer are as follows

Q: If a partnership is liquidated, partners ( except for limited partners) are liable to the extent of…

A: Partnership is an agreement by two or more individuals to do a business together and the profit or…

Q: Which of the following results in the dissolution of a partnership? The withdrawal of a partner of…

Q: Which of the following life insurance proceeds is not included in the gross estate of the deceased?…

A: Following are excluded from Gross Estate: Property owned solely by the decedent's spouse or other…

Q: How is a predistribution plan created for a partnership liquidation?

A: In a partnership, two or more parties agree to operate and manage a business and share the profits…

Q: If no agreement exists in a partnership as to the allocation of income, what method is appropriate?…

A: Partnership: It is a form of a business where two or more people come together to do business…

Q: Discuss the rule as to the share of profits and losses of the partners among themselves.

A: A partnership is one of the forms of doing the business where two or more people conduct the…

Q: When a partner sells an ownership interest in a partnership, what rights are conveyed to the new…

A: Partnership: A partnership is an unincorporated form of business which is formed by an agreement,…

Question

Why a retiring/deceased partner is entitled to a share of goodwill of the
firm.

Definition Definition Intangible asset that includes proprietary or intellectual property and brand value of a firm. Goodwill is recorded in the books when a firm purchases another firm and the purchase price is more than the fair value of net identifiable assets of the acquired business. The amount of goodwill is recorded on the asset side of the balance sheet (statement of financial position).

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

How does a newly formed partnership handle the contribution of previously depreciated assets?
if a partners is insolvent his personal properties shall first be distributed
If a partner contributes depreciable or amortizable property to the partnership, how is the basis of those properties recovered?
Which one of the following is a circumstance for valuation of goodwill? a. At the time of a partner receiving salary b. At the time of a partner receiving commission c. At the time of a partner is taking drawings d. At the time of death of a partner
The following are exclusive property under the system of conjugal partnership of gains, which is not? Property before marriage Inheritance during marriage Property acquired during marriage out of exclusive money Rental income on a property acquired before marriage
When a partner sells an ownership interest in a partnership, what rights are conveyed to the new owner?
The accounting treatment for the sale of the interest of the retiring partner to an outsider or remaining partners is the same as in admission by purchase of interest admission by investment or by purchase admission by investment sale of interest to the partnership
Determine Julie's basis in her partnership interest and tax return effects. Also, determine Julie's basis in any property received as a distribution from the partnership
Can a partnership assume liabilities as part of one of the partners contributions?
What is the first step in a partnership liquidation (termination and sale of assets)?
When a partnership is liquidated, any gains or losses realized by the sale of noncash assets are allocated to the partners based on their income sharing ratio. Why?
There is a liquidation of assets of a partnership. Describe the order in which assets must be distributed upon liquidation of a partnership, and explain the "right-of-offset" concept.