Explanation:
Carriage inwards is a direct expense because it is directly attributable to the purchase of goods and bringing them to the place of business.
S1: In a partnership, if a new partner is admitted and brings his share of goodwill in cash, the goodwill account is credited. S2: If the goodwill account already exists in the books, it is written off among the old partners in their old profit-sharing ratio before admission. Which statement(s) is/are correct?
Explanation:
S1 is incorrect because AS 26 prohibits opening a goodwill account; the cash brought is credited to the old partners' capital accounts in their sacrificing ratio. S2 is correct; existing goodwill is written off in the old ratio before the new partner's admission.
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