Questions 8, 9 & 10

Yam & Willow were in partnership sharing profit and losses equally. They admit Mahoe as a partner and decide to share profits equally among the three partners. Goodwill is valued at $30,000 but is to be immediately written off. The effect of this on Yam's capital would be to: A. increase it by $5 000 B. decrease it by S5 000 decrease it hy S10 000 || 5000 10. When there is change in ownership composition of a partnership, the profit and loss appropriation account must be prepared A. In separate books under old and new partnerships. In columnar form under old and new partnerships. al In parte ledeci dow par D. Only if the partners agree to it. When a new partner is admitted to a partnership under the goodwill method, an original partner's capital account may be adjusted for i. A proportionate share of the incoming partner's investment. ii. His or her share previously unrecorded goodwill traceable to the original partners. iii. His or her share previously unrecorded goodwill traceable to the incoming partner. A. I only B. is only C. lii only D. neither i, ii norii