How to calculate hidden goodwill in retirement/ death of a partner??
Dear Student,
Here is your answer,
Here is your answer,
The amount paid to the retiring partner/deceased partner's executor in excess of the amount actually due to them is hidden goodwill.
Eg, If the amount due to a retiring partner/deceased partner's executor is Rs. 20000 and the partners decide to pay him Rs. 25000 then ,hidden goodwill = 25000 - 20000 = Rs. 5000
Regards.