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A Level Accounting (9706)•9706/12/M/J/22
Question 15 from 9706/12/M/J/22

Explanation

Partnership admission adjustments require new profit-sharing details Steps:

  • Tangible assets reduced by 20,000createsarevaluationlosssharedequallybyDuaandNoor(20,000 creates a revaluation loss shared equally by Dua and Noor (20,000createsarevaluationlosssharedequallybyDuaandNoor(10,000 each).
  • Goodwill valued at $20,000 but not retained implies an adjustment to old partners' capitals, typically crediting them in old ratio then handling via new partner's contribution or write-off.
  • Without Zee's profit share or contribution amount, goodwill adjustment (credit to Noor minus any write-off share) cannot be quantified.
  • Net effect on Noor's capital combines revaluation loss and unresolved goodwill impact.

Not enough information.

Final answer: Not enough information.

Topic: Business acquisition and merger

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