The amount paid by a new partner on admission as a compensation for the reputation built up by old partners is a?

By: |Published on: Dec 1|Categories: Accounting JAMB| 0 comments

A. bonus
B. commission
C. premium
D. goodwill

Correct Answer:

Option D – goodwill

Explanation

Goodwill in accounting is an intangible asset that arises when a buyer acquires an existing business. Goodwill represents assets that are not separately identifiable.

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