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    MCQ 12th Cbse

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    MCQ 12th Cbse

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    MCQ 12th Cbse

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    1 F ‘undamentals Accounting for Partnership Firms — end of the book : (i) Features or Characteris of Partnership Q. 1. Features of a partnership firm are (A) Two or more persons are cartyin, (B) They are sharing profits and loss (©) Business is carried by all or am (BYAI of the above. common business under an agreement, es in the fixed ratio, ¥ of them acting for all as an agent, HOTS Q.2. Following are essential elements of partnership firm except : (A) Atleast two persons (B) There is an agreement between all partners (C7 Equal share of profits and losses (D) Partnership agreement is for some business. (CPT; June 2012) HOTS Q.3. In case of partnership the act of any partner is : NA Binding on all partners (B) Binding on that partner only (©) Binding on all partners except that particular partner (D) None of the above (CS. Foundation Dee. 2012) HOTS Q.4. Which of the following statement is true? (A) a minor cannot be admitted as a partner (B) aminor can be admitted as a partner, only into the benefits of the partnership (©) aminor can be admitted as a partner but his rights and liabilities are same of adult partner (D) none of the above ACCOUNTING FOR PARTNERSHIP FIRMS, ~ FUNDAMENT; ny ‘ HOTS Q. 5. Oustensible part {Ay do not contribute 3 capital bu name (0 the busines «ay sob very Hs api wom profit : eee any capital and without having any j area cone ie business having any interest in the ip) contbute maxima capital oF ME business mers are those WHO ut get some share of profit fc ofit for lendin, 18 thei HOTS 6 Sleeping partners are those who |A) take active part in the conduct of the business but _ ; (A) owever, salary is paid to them Provide no capital (B) donot take any part in the conduct of the business but provi . Share profits and losses in the agreed ratio Provide capital ang (C) take active part in the conduct of the business but provide However, share profits and losses in the agreed ratio, Ro capital (D) do not take any part in the conduct of the business and contri so Tr However, share profits and loses inthe areed “i (0.7 The relation of partner with the firm is that of (A) An Owner (B) An Agent (C) An Owner and an Agent (D) Manager (8. What should be the minimum number of persons to form a Partnershi - aa ership (10 (D) 20 Q. 9. Number of partners in a partnership firm may be eo Maximum Two (B) Maximum Ten Maximum One Hundred (D) Maximum Fifty Q. 10. Liability of partner is : (A) Limited B) Unlimi (C) Determined by Court > oe = (D) Determined by Partnership Act ey Q.11. Which one of a of the following is NOT an essential feature of a partnership? (A) There must be an agreement (B) There must be a business (tT i i hn uses must be carried on for profits USI mess must be carried on by all the partners eet Q. 12% ¥ and Z are partners sharing profits and losses equally. Their capital balances on March, 31, 2012 are %80,000, 60,000 and %40,000 respectively. ‘Their personal assets are worth as follows : ¥— %20,000, Y — %15,000 and Z— ®10,000. The extent of their liability in the firm would be : (A) X — $80,000 : ¥ — %60,000 : and Z— %40,000 (B) X— %20,000 : ¥Y— 15,000 : and Z— 210,000 (C) X— 81, 00,000 : y — 275,000 : and Z— %50,000 (D) Equal (CS. Foundation; June 2013) Q. 13. Every partner is bound to attend diligently to his in the conduct of the business, (A) Rights (B) Meetings (C) Capital (D) Duties (ii) Partnership Deed HOTS Q. 14, Forming a Partnership Deed is (A) Mandatory (B) Mandatory in Writing (C) Not Mandatory (D) None of the Above HOTS Q. 15. Partnership Deed is also called (A) Prospectus (B) Articles of Association (C) Principles of Partnership (D) Anticles of Partnership hors 16. Which of the following is not incorporated in the Partnership Act? (A) profit and loss are to be shared equally (B) no interest is to be charged on capital (C) all loans are to be eh d interest (@6% p.a, (D) all drawings are to be charged interest Q.17. When is the Partnership Act entorced? (A) when there is no partnership deed (B) where there is a partnership deed but there are differences of opinion between the partners (C) when capital contribution by the partners varies (D) when the partner's salary and interest on capital are not incorporated in the partnership deed ' By y WV ACCOUNTING FOR PARTNERSHIP Fags FUNDAM 4 ott i isalng v7 UNOAMENy “g. 18, Inthe absence of Partnership Deed, the interest is alloweq on pariners >| 12 _ ACCOUNTING FOR PARTNERSHIP Fins — FNAME, eo EHP rus . (vi) Interest on Drawings HOTS (2.74, Partners re suppose fo pay interest ondrawingonly when... by the (A) Provided, Agreement (B) Pemited, mesg (C) Agreed, Partners (0) ‘A’ &C above HOTS Q. 75. Where will you record interest on drawings : (A) Debit Side of Profit & Loss Appropriation Account (B) Credit Side of Profit & Loss Appropriation Account (C) Credit Side of Profit & Loss Account (D) Debit Side of Capital/Current Account only. (CPT; tune 011 Q. 76. How would you close the Partner’s Drawing Account : (A) By transfer to Capital or Current Account Debit Side. (B) By transfer to Capital Account Credit Side, (© By transfer to Current Account Credit Side. (D) Bither ‘B’ or ‘C’. 7. If date of drawings of the partner's is not given in the question, interest ig charged for how much time (A) | month (B) 3 months, (©) 6 months (D) 12 months Q. 78. Vilas is a pariner in a firm. His dravvings during the year ended 31st March 2019 were 872,000, I interest on drawings is charved (a ®% pa the intact charged will be : (A) 8324 (1) 86.480 (©) 8240 (D) oss 79. fa fixed amount is withdrawn by a partner on the fist day of every month interest on the total amount is charged for ah (A) 6 (B) 6! (5% (D) 12 @.80-If a Fixed amount is withdrawn by a partner on th lst day of every month, interest onthe total amount is charged for months e ts (B) 6% A (D)6 Q81. if ita fixed amount is withdrawn by a Partner in the middle of every month, ea On the total amount is charged for months 4 Os (B) 64 (D) 12 [ACCOUNTING FOR PARTNERSHIP FIRMS — FUNDAMENTALS Q. 82. Q.83. Q.84. Q.85. Q. 86. Q.87 Q.88. 0.89. Q. 90. 3 Ina partnership firm, a partner withdrew 25,000 per month on the first day of every month during the year for personal expenses. If interest on drawings 1 charged (@ 6% p.a. the interest charged will be (A) 83,000 (By 71,950 (C) 1,800 (D) 21,680 (CS Foundation, Dec 2012) Ajay is a partner ina firm. He withdrew %2,000 per month on the last day of every month during the year ended 31st March, 2019. If interest on drawings is charged @ 9% pra. the interest charged will be 7 (A) 7990 (B) 71,080 (C) 21,170 (D) 22.160 Sushil isa partner in a firm. He withdrew %4,000 per month in the middle of every month during the year ended 31st March, 2019. If interest on drawings is charged (@ 8% p.a. the interest charged will be (A) 32,080 (B) 21,760 (C) 33,840 (D) %1,920 If fixed amount is withdrawn by a partner on the first day of each quarter, interest on the total amount is charged fOr ......e Months (A) 45, (B) 6 (75 (b)3 Ifa fixed amount is withdrawn by a partner on the last day of each quarter, interest on the total amount is charged for... months (A) 6 (B) 4.5 (O75 (D)3 Ifa fixed amount is withdrawn by a partner in each quarter, interest on the total amount is charged for... months (A)3 (B) 6 (4s (D) 75 Anuradha is a partner in a firm, She withdrew %6,000 in the beginning of each quarter during the year ended 31st March, 2019. Interest on her drawings @ 10% p.a. will be (A) 2900 (B) €1,200 (C) 21,500 (D) 7600 Bipasa is a partner in a firm, She withdrew’ %6,000 at the end of each quarter during the year ended 31st March, 2019. Interest on her drawings @ 10% pa will be : (A) 2900, (B) %600 (C) @1,500 (D) T1200 Charulata is a partner in a firm, She withdrew %10,000 in each quarter during the year ended 31st March, 2019, Interest on her drawings 0 9%o p.a_ will be: (A) 71,350 (B) &2,250 (©) 2900 (D) T1800 __ ACCOUNTING FOR PARTNERSHIP FIRMS — FUNDAM HOTS 6.9 Hrequal amount is withdrawn by a partner inthe beginning of each moy during a period of 6 month, interest on the otal amount will be charged : vnanoew months . (A) 25 (B)3 (35 (0) 6 Q. 92. Ifequal am period of 6 months, interest Tag jount is withdrawn by a partner in the end of each month during a on the total amount will be charged for... months (A) 2.5 (B)3 (35 (6 month during a period of 6 . months amount is withdrawn by a partner in each Q. 93. Ifequal months, interest on the total amount will be charged for . (A) 6 (B)3 © 25 (p) 3.5 le withdrew regularly 71,000 at the beginning of mths ending 31st March, 2019. If interest on Q.94, X's a partner in a firm. Hi jerest charged will be : every month for the six mo drawings is charged @ 8% p.a. the int (A) %240 (B) 7140 (C) 2100 (D) 2120 HOTS fe withdrew regularly £3,000 at the end of every Q.95. Yis a partner in a firm. H ‘h, 2019, If interest on drawings is month for the six months ending 31st Marc! charged @ 10% p.a. the interest charged will be (B) 7450 (A) 375 (© 8525 (D) %900 Q. 96, Zis a partner in a firm. He withdrew regularly €2,000 every month for the six months ending 31st March, 2019. If interest on drawings is charged @ 8% p.a. the interest charged will be : (A) 2480 (© €200 Q. 97. A partner withdraws %8,000 each on Ist April and Ist Oct. Interest on his drawings @ 6% p.a. on 31st March will be : (A) 480 (B) 2720 (© %240 (D) 2960 98 A pater dans £2,000 each on st Api 2018, st July 2018, Ist October 18 and Ist January 2019, For the year ended 31st March, 2019 interest on drawings @ 8% per annum will be : : meron (A) %540 (B) %320 (©) %960 (D) %400 (B) %280 (D) %240 ue ge a ne soc ONT FOR PATHERSH RS — yay 9A AENTALS 0. partner withdraws from firm 27,000 athe ena oe 5 , é 37,000 at the oe 6% per annum total interest yi end of each month. At the (A) 85,040 rest will be = erate of | (B) 22,310 (©) 83,570 (D) 21,370 (vii) Adjustments in the Closed Accounts 100, Anu and Tanu a ith f Q non et eee = capitals of %2,00,000 and March, 2019 it was discovered that interest on canal pace att to be provided. In the adjusting entry tia (A) Anu will be credited by %16,000 and Tanu will be credited by 28,000 (B) Anu will be debited by 216,000 and Tanu will be debited by 28,000 (C) Anu will be credited by 74,000 and Tanu will be debited by %4,000 (D) Anu will be debited by 4,000 and Tanu will be credited by 74,000 (101. Sony and Romy are equal partners with fixed capitals of %4,00,000 and 23,00,000 respectively. Afler closing the accounts for the year ending 31st March, 2019 it was discovered that interest on capitals was provided (@ 8% instead of 10% p.a. In the adjusting entr (A) Sony will be credited by %8,000 and Romy will be credited by 26,000 (B) Sony will be debited by %8,000 and Romy will be debited by %6.000. 21,000 and Romy will be credited by &1,000 (C) Sony will be de (D) Sony will be redited 21.000 and Romy will be debited by @ 1,000. (102, Asha and Vipasha are equal f th fixed capitals of 25,00,000 and 22,00,000 respecti¥ ar ending 31st March, 2019 it wo ul wu 6" t by 21,500) 21,500, (B) Asha ee (C) Ash {by €2,000 (D) Asha wi 290,000 ane Q. 103. P and Q sharing profits 9 the 8 ae ined ap al ening 31S 260,000 respective sing the ae I el March, instead of 8° 21,800 and Q will be P will be © Clas Q will be credites sd by £200; 2200 and > will be debited by oe 0 and Q will be debe II be debit .d by 7200: by @1,200: (C) P will be credited by ed by 71.800 and O 4 (D) P will be debit ACCOUNTING FOR PARTNERS AMEN 8 8 sharing profits inthe ratio of 7 3 have figeg eats or ets e oF eh 000 rpectvely After closing the 2.00.95, ne March, 2019 it was discovered that interest on 1 ie instead of 10% pa Inthe adjusting entry ve 4 will be debited by €4,000 and B will be debited by 22.000, t i y 2, (B) 4 will be credited by &4,000 and B will be Credited by 22,000. ) 4 il be debited by €200 and B will be crediteg by ‘ 2200, (D) A wil be credit by €200 and B will be debited by eaqy ~F 8 for Year Capitals Was nis iat (5. Vand V are partners inthe ratio of 3:2, Their fixed ¢ . 71,00,000 respectively. After clsoing the accounts Pals ae 22.49 ogy, . March, 2019, it was discovered that interest on ¢; for the year g . ding 315 apital Was atlowey instead of 10% per annum. By how much amount @ 13 ‘Will be dbitedicedngy in the adjustment entry (A) 2600 (Debit) (B) 400 (Credit) (C) 2400 (Debit) (D) 2600 (Credit) Q. 100. X. Yand Z are equal partners with fixed capitals of | %2,00,000, 33,00,000 ang “ 24,00,000 respectively. After closing the accounts forthe Year ending 31s. March, 2019 it was discovered that interest on capitals @ 8% p.a, was omittey to be provided. Inthe adjusting entry : (A) Dr. Vand Cr. ¥ by 28,000 (B) Cr, Nand Dr. Z by %8,000 (C) Dr. Xand Cr. Z by 28,000 ‘ (D) Cr. Yand Dr. ¥ by 28,000 - 107. PQ and Rare equal partners with fixed capitals of €5,00,000, %4,00,000 and for the year ending 31st that interest on capitals was provided (@ 7% instead of 9% paa. Inthe adjusting entry (D) P will be credited by %2,000 and R will be debited by & 2,000. ..108.¥, Yand Zare dual partners with fixed capitals of ectively. Afler closing the accounts tor the Is ‘was discovered tht interest om capitate was provided «@ 6° Pa In the adjusting entry « (4) De X and Cr. Zby 22,000 (B) Cr Xand Dr. Z by 22,000 (C) Dr Xand Cr, Yby 22.099 (D) Cr, Nand Dr, Yby 22,000 ACCOUNTING FOR PARTNERSHIP FIRMS — FUNDAMENTALS Q. 109. Q. 110. Qui (viii) Guarantee of Qn. Q.113. 7 P,Q and R sharing profits in the ratio of 204 $4,00,000, 23,00,000 and &2 for the year ending 31st M, capitals Was provided @ 6% 1 have fixed capitals of 00,000 respectively. After closing the accounts larch, 2019 it was discovered that interest on ‘instead of 8% p.a. In the adjusting entry (A) Cr. P21,000; Dr. 9 &1,500 and Cr. R 8500 (B) Dr. P 8500; Cr. 9 81,500 and Dr. R 21,000 (C) Cr. P 500; Dr. Q 1,500 and Cr. R &1,000 (D) Dr. P 21,000; Cr. Q %1,500 and Dr. R &500 A,B and C sharing profits in the ratio of 2 $5,00,000, %2,00,000 and @1,00,000 respectively. Alter closing the accounts for the year ending 31st March, 2019 it was discovered that interest on capitals was provided @ 12% instead of 10% paa. Inthe adjusting entry (A) Cr. A 81,200; Dr. B 800 and Dr, C &400 (B) Dr. A 81,200; Cr. B 800 and Cr. C 8400 (©) Cr. A 8800; Cr. B 400 and Dr. C #1,200 (D) Dr. A 800; Dr, B 2400 and Cr. C 21,200 2: | have fixed capitals of %, Yand Z are partners in the ratio of 4 : 3 : 2. Salary to Y 715,000 and to Z 33,000 omitted and profits distributed. For rectification, now -Y will be credited : (A) 215,000 (B) 21,000 (©) 212,000 (D) 27,000 er When a partner is given guarantee by other partners, loss on such guarantee will be borne by : (A) Partnership firm (B) All the other partners (C) Partners who give the guarantee (D) Partner with highest profit sharing ratio. Guarantee given to partner ‘A’ by the other partners *B & (A) In case of loss ‘A’ will not contribute towards that loss (B) In case of insufficient profits “A* will re guarantee amount. ive only the minimum (©) In case of loss or insufficient profits ‘A’ will withdraw the minimum guarantee amount, (D) All of the above. el ON ACCOUNTING FOR PARTNERSHIP FIRMS — FUNDAMENTALS infirm in 3:2: 1. Ris guaranteed that he Qk PD ot ead ss share of profit every year. fae al hs toon ute wile: (ay P €40,000; @ &30,000;R €20,000; () P 42,500; Q €27,500; R €20,000; (c) P 845,000; 0 £30,000; R €15,000; () P 42,000; Q ¥28,000; R €20,000; it io of 5:4:3. Xhas given to Za 5, id Zare partners in the ratio of : ce Qs, ee 210,000 profit For the yea ending 31st March, 2019, fim’ pros js £28,800. 1°s share in profit will be : (B) %9,600 (A) 89,200 (B) %9, © 37,200 (D) 212,000 HOTS Q. 116. E, F and G share profits in the ratio of 4: 3:2. Gis given a guarantee that his "she of profits wil not be less than €75,000, Deficiency if any, would be bome by E and F equally Firm's profit was 270,000. F°s share of profit wi be (A) 290,000 (B) 282,500 (©) 897,500 (D) 275,000 Q.117. X, Yand Z are partners in the ratio of 6 : 4: 1. Inthe firm has guaranteed Z for his minimum profit of €15,000, Firm’s profit was 299,000. In the firm profit 1°s share will be : (A) 830,000 (B) 215,000 (©) 848,000 (D) 245,000 HOTS M3 Q. 118. P, O and R are partners in 3:2 1, Ris guaranteed that his share of profit will not be less than 270,000. Any deficiency will be borne by P and Q in the ratio Of : 1. Fim’s profit was €2,40,000. Share of P will be: (A) &1,00,000 (B) %1,10,000 (C) %1,20,000 (©) %1,02,000 O19. Vand Z are partners in 5:4 | Zis guaranteed that his share of profit will not be less than €80,000, Any deficiency will be bore by X and ¥ in 3:2 Firm's profit was &5,60,000. How (A) 82,14,400 much deficiency will be borne by Y : © 809,600 (B) 14,400 < (0) 89,600 | ae accoUNTING FOR PARTNERSHIP FIRMS — FUNDAMENTALS 19 nots Q. 120. Pand Q are partners sharing profits in the ratio of 1:2, R was manager who re ae : ay of 710,000 p.m, in addition to commission of 10% on net profits er charging s ich commission. Total remuneration to R amounted to 21,80,000. Profit for the year before charging salary and commissi : (B) %6,00,000 (€) 27,80,000 (D) %6,60,000 HOTS: Q, 121. Nand Y are partners. X draws a fixed amount at the beginning of every month, Interest on drawings is charged @8% p.a, AL the end of the year interest on X's drawings amounts to 82,600, Drawings of X'were : (A) 28,000 p.m. (B) 37,000 p.m, (C) 26,000 p.m. (D) %5,000 p.m. nots 122. A and B are partners. B draws a fixed amount at the end of every month, Interest on drawings is charged @15% p.a. At the end of the year interest on B’s drawings amounts to 8,250. Drawings of B were : (A) 712,000 p.m. (B) €10,000 p.m. (C) 29,000 p.m. (D) 8,000 p.m. HOTS (. 123.4 and B are partners with a profit sharing ratio of 2 : 1 and capitals of 3,00,000 and %2,00,000 respectively. They are allowed 6% p.a, interest on their capitals and are charged 10% p.a. interest on their drawings. ‘Their drawings during the year were 4 260,000 and B %40,000. B's share of net profit as per profit and loss appropriation account amounted to 240,000, Net Profit of the firm belore any appropriations was, (A) 21,22,000 (B) %1,13,000 (©) @1,17,000 (D) &1,45,000 Q. 124. Aand B are partners in a firm. They are entitled to interest on their capitals but the net profit was not sufficient for this interest, then the net profit will be distributed among partners in (A) Agreed Ratio (B) Profit Sharing Ratio (C) Capital Ratio (D) Equally (CPT, Dec. 2012) See answers at the end ON ' 2 Change in Profit Sharin : Among the Existing Parra —— Multiple Choice Questions Select the Best Alternate : 1. Sacrificing Ratio (A) New Ratio ~ Old Ratio (B) Old Ratio New Ratio (C) Old Ratio Gaining Ratio (D) Gaining Ratio Old Ratio 0.2, Gaining Ratio (A) New Ratio ~ Sacrificing Ratio (B) Old Ratio - Sacrificine Ratio (C) New Ratio ~ Old Ratio (D) Old Ratio New Ratio 3. A and B were partners ina firm sharing: profit or loss euyally. With effect rom Ist April, 2019 they agreed to share pris inthe ratio of 4 3. Duc wechaoee in profit sharing ratio, As gain or sacritice will be : (A) Gain (B) Sacritie (C) Gain 4 (D) Sacritice 3 Q.4, A and B were partners in a firm sharing profit or loss equally. With effect from !st April, 2019 they agreed to share profits in the ratio of 4 3. Due to change in profit sharing ratio, B's gain vr sacrifice will be 1 1 (A) Gain = acrifive (A) Gain i4 (B) Sa i4 4 (©) Gain 5 (D) Sacritive Q.S. dand B were partners in a firm sharing profit or loss in the ratio of 3-5. With effect from Ist April, 2019, they agreed to share profits or losses equally. Due ‘o change in profit sharing ratio, ’s gain or sacrifice will be ne 3 (A) Gain 5 L B) c (B) Gain 5 © Sacrifice § (D) Sacrifice + (CHANGE IN, PROFIT SHARING RATIO AMONG THE EXISTING, PARTNERS: 6, A and B were partners in a firm sharin i Oe ete aman 1g profits and losses in the ratio of 2: 1. + 2019 they agreed to share fig a profits and losses equally. Individual partner’s gain or Sacrifice due to change in the ratio will a (A) Gain by 4 _ 1 Py Sactitice by B2 —(B) Sacrifice by A ‘ Gain by ak °) Gai © gsc 1 (©) Gain by 4-5; Sacrifice by B- (0) Sacrifice by Ad: Gain by B+ 7 4 and B A Profi and fess in the ratio of 3 : 2. With effect from Ist january, , they agreed to share profit in it Parton Profits equally. Sacrificing ratio and e 1 ‘ (A) Sactifce by 4 3 Secriice by Bt fl 1 (B) Gain by 475; Gain by BF : 1 1 (©) Sacrifice by 4.75; Gain by BE (D) Gain by 4+. p 1 1 Sacrifice by BE Q.8. A and B were partners ina firm sharing profit or loss inthe ratio of 3 : 1. With effect from Jan. 1, 2019 they agreed to share profit o loss in the ratio of 2: 1. Due to change in profit-loss sharing ratio, B's gain or sacrifice will be (A) Gain + (B) Sacrifice (© Gain} (D) Sacritice + Q.9. 4, Band C were partners sharing profit or loss in the ratio of 7 : 3:2, From Jan, 1, 2019 they decided to share profit or loss in the ratio of 8 4:3. Due to change in the profit-loss sharing ratio, B’s gain or sacrifice will be : 1 4 ou (A) Gain 55 (B) Sacrifice 55 2 a © Gain 55 (D) Sacrifice 5 Q. 10. X, Yand Zare partners ina firm sharing profits and losses in the ratio of 5:3:2. The partners decide to share future profits and losses in the ratio of 3:2: 1. Each partner’s gain or sacrifice due to change in the ratio will be : oe (A) X Sacrifice 30° Y Gain 30° ZNil (B) XGain sb; YNit, Z Sacrifice i (C) XNil; ¥ Sacrifice 39° 2 Gain 35 fi 1 L D) Y Gain <., af (D) XNil; YGain 39° Z Sacrifice 30 2 Qh QR. Q. 14. decided to share future profits in 4 : 3: CHANGE IN PROFIT SHARING RATIO AMONG 1H and C were pariners in a firm sharing profits and lose ENSTING Pap 8 i A,B sey The partners decide to share future prof in a . its 2:2:1 earners gain oF sacrifice de to change ys te nie eee in rat i (A) Sacrifice A 55% Gain B 39+ iain C55 10 Will be. i 2 L, gecrifice C B yp: Sacrifice C55 {B) Gain 4 35: Gan »y sgertice Ao: Gain BA; Gain C2 (c) Sacrifice 4h Gai B 593 Gain C59 sacrifice CL 10 ab 1 (D) Gain A 30° Gain B 15 “gi and Cwere partners ina firm sharing profits and aoa pe partners decide to share future profits and sin he ati 22 Ee Ie Fatio of “Bach partner's gain or sacrifice due to pa change in the ratio will be sacrifice B=; Gain C2 (A) Sacrifice A 2; Sueifice B G5 Gain C 75 2 3 7 (B) Gain A Ze Sacrifice B ygs Gain C35 2. Gain B 2; Sacri 1 (©) Sacrifice A Ze Gain B 35; Sacrifice C35 Gi. «hilt Gain B gs Sacrifice C5 in a firm sharing profits in 4 : 3 : 2 ratio. They I ratio, Sacrificing ratio and gaining ee (D) Gain 4 53 4, Band C were partners ratio willbe : (A) A Sacrifice 4; B Sacrifice 3. cGain rad 2 nR (8) A Gain 5; B Gain 4 C Sacrifice z (©) A Sacrifice 3; B Sacrifice 4; C Gain . 2’ ae: 2 (0) A Gain 4 B Gain 3; C Sacrifice - nn’ ia 72 1 Y and Z were partners sharing profits in the ratio 2:34 with est fiom ratio 3.24: 5. Bach 1st January, 2019 they agreed to share profits in the partner’s gain or sacrifice due to change in the ratio will be: (A) XGain % YNil; Z Sacrifice z oi (8) X Sucre J YNil, Z Gain 35 7 i I ee (©) XGain $Y Sacrifice a ZNil Ome )) X Sacrifice 36: Y Gain 36; Z Nil ‘CHANGE IN PROFIT SHARING RATIO AMONG THE EXISTING. PARTNERS and Z were 2B in parine sea to share is profits in the ratio 4 3:1. The partners sha © profits in the ratio § erent sacrifice due to change in ratio will be io 5-24 3. Hach partner's gain or 3 2Gi jain (A) X Sterfice 2 ¥ Sacrifice x i. (B) X Gain 55: V Gain 3 Z Sacrifice ~ ae ae | (C) X Sucifce 1 ¥ Satitie 2 ie 2 Pe D) X Sacrifice 2: ¥ Gain 2:7 (D) X Sacrifice 545 ¥ Gain 54 Q. 16. A, Band Care equal partners in the firm. It is now agrecd that they will share the future profits in the ratio 5:3 : 2. Sacrificing ratio and gaining ratio of different partners will be : (A) A Sacrifice >; B Gain +; C 2. 4 30° 30° "30 7 s (B) A Gain 5; B Sacrifice * C Sacrifice + nk: Bsa (©) A Gain 55; B Sacrifice 55; 5. B Gain + 30° 8 Sain 59% oo C Sacrifice 35 (D) A Sacrifice CGain + HOTS 0. 17. (A) Goodwill is a fictitious asset (B) Goodwill is a current asset (©) Goodwill is a wasting asset (D) Goodwill is a intangible asset Q. 18. The excess amount which the firm can get on selling its assets over and above the saleable value of its assets is called : (A) Surplus (B) Super profits (© Reserve (D) Goodwill HOTS. ©. 19. Which of the following is NOT true in relation to goodwill? (A) It is an intangible asset (B) Itis fictitious asset (C) Ithas a realisable value (D) None of the above Q. 20, When Goodwill is not purchased goodwill account can (A) Never be raised in the books (B) Be raised in the books (C) Be partially raised in the books (D) Be raised as per the agreement of the partners = CHANGE IN PROFIT SHARING RATIO AMONG THE EXISTING PA oe ey a se HOTS ¢,21. The Goowil ofthe firm is NOT affected by: : (A) Location of the firm (B) Reputation of firm (© Better customer service (D) None of the above (CPT: ne 29) i ip firm is €5,00,000. Its average prof ital employed by a partnership firm is , ts av Profit oe earn The normal rate of return in similar type of business is 10%. Wha, i the amount of super rofits? (A) 850,000 (B) @10,000 (© 26,000 (D) 856,000 (CS. Foundation, Dec., 20]; 12) Q. 23. Weighted average method of calculating goodwill is used when : (A) Profits are not equal (B) Profits show a trend (©) Profits are fluctuating (D) None of the above (CPT, June 2009) Q.24. The profits earned by a business over the last 5 years are as follows ; 212,000; 213,000; 214,000; 218,000 and %2,000 (loss). Based on 2 years purchase of the last § years profits, value of Goodwill will be : (A) & 23,600 (B) & 22,000 (© %1,10,000 () 21,18,000 Q. 25. The average profit of a business over the last five years amounted to 60,000. The normal commercial yield on capital invested in such a business is deemed to be 10% pa. The net capital invested in the business is 5,00,000. Amount of goodwill, ifit is based on 3 years purchase of last 5 years super profits will be: (A) 21,00,000 (B) 21,80,000 (©) & 30,000 (D) 21,50,000 HOTS 26. Under the capitalisation method, the formula for calculating the goodwill is: (A) Super profits multiplied by the rate of retum (B) Average profits multiplied by the rate of return (C) Super profits divided by the rate of return (D) Average profits divided by the rate of return (CPT; Dec. 2011) capitalisation of super profits, (A) 220,000 (B) 30,000 (C) 225,000 () None of these | pROFIT SHARING RATIO AMONG THE EXISTING PARTNERS aN pace cH 6 2 a ~ otal Capital employed in the firm is ®8,00,000. reaso of return is : h 00,000, i 15% and Profit for the year is 212,00,000. The eerie roca as per capitalization method would be : oe {A) €82,00,000 (B) €12,00,000 (c) €72,00,000 (©) &42,00,000 (CS. Foundation, June 2013) ‘The average capital employed ofa fim i K is %4,00,000 and th retum is 15%. The average profit ofthe firm is ®80,000 ee ih ‘4 remuneration of the partners is estimated to be %10,000 per ee the basis of two years purchase of super-profit, the value of the Goodwill val 3 be: (A) #10,000 (B) %20,000 (C) 260,000 (D) %80,000 ¢.30.A firm ears €1,10,000. The normal rate of retum is 10% The assets ofthe Q3l. 0.33, 4, Band C are partners sharing profits in the rat firm amounted to €11,00,000 and labilit i by capitalisation eee aa oe ap cf eoodwil (A) 22,00,000 (B) = 10,000 Oz 5,000 (D) %1,00,000 (CS. Foundation Dee., 2012) Capital invested ina firm is 25,00,000. Normal rate ofretum is 10%, Average profits of the firm are €64,000 (after an abnormal loss of €4,000). Value of goodwill at four times the super profits will be : (A) & 72,000 (B) & 40,000 (© 22.40,000 (D) 21,80,000 9, P and Q were partners sharing profits and losses in the ratio of 3 : 2. They decided that with effect from Ist January, 2019 they would share profits and Tosses in the ratio of 5 : 3. Goodwill is valued at %1,28,000. In adjustment entry (A) Cr. Py & 3,200; Dr. Oby € 3,200 (B) Cr. P by %37,000; Dr. O by €37,000 (C) Dr. P by €37,000; Cr. O by 37,000 (D) Dr. Phy & 3,200 Cr. Qby & 3,200 io of 4 :3 : 2 decided to share profits equally. Goodwill of the firm is valued at 710,800. Tn adjusting entry for goodwill (A) 4’s Capital A/c Cr. by 4,800; B’s Capital A/c Cr. by %3,600; C’s Capital A/c Cr. by 2,400. (B) A’s Capital Ale Cr. by €3,600; B’s Capital Ae Cr. By 23,600; C’s Capital Ale Cr. by %3,600. (C) 4’s Capital A/e Dr. by €1,2005 (D) A’s Capital Ale Cr. by €1,2005 C C’s Capital Ale Cr. by 1,200; Capital Alc Dr. by €1,200 CHANGE IN PROFIT SHARING RATIO ag 6 NO AMONG THE Eis i : were partners sharing profits and losses j . M Od Ban puny, 2019 they decided to share profits and pose of7, 8 8:4: 3, Goodwill is €1,20,000. In Adjustment entry fr go0dvil the rag (A) Cr. A by %6,000; Dr. B by %2,000; Dr. C by &4,999 (B) Dr. A by %6,000; Cr. B by 82,000; Cr. C by e4go9 (C) Cr. A by 26,000; Dr. B by %4,000; Dr. C by &2,999 (D) Dr. A by 6,000; Cr. B by 4,000; Cr. C by 82.009 2.38. P, Q and R were partners in aim shaving profis in 5. 3,» - decided to share the future profits in 2:3: 5. For this Purpose the pony, UY the firm was valued at €1,20,000. In adjustment entry for ihe “food goodwill due to change in the profit sharing ratio : tment op (A) Cr. P by %24,000; Dr. R by %24,000 (B) Cr. P by %60,000; Dr. R by %60,000 (C) Cr. P by %36,000; Dr. R by %36,000 (D) Dr. P by %36,000; Cr. R by €36,000 36.4, Band C are partners ina firm sharing profits in the ratio of 3-4 They decided to share profits equally w..f. Ist April, 2019. On that date the Pro and Loss Account showed the credit balance of 896,000, Instead of closing the Profit and Loss Account, it was decided to record an adjustment entry reflecting the change in profit sharing ratio. In the journal entry : : (A) Dr. A by & 4,000; Dr. B by %16,000; Cr. C by %20,000 (B) Cr. A by & 4,000; Cr, B by €16,000; Dr. C by 220,000 (C) Cr. A by 816,000; Cr. B by & 4,000; Dr. C by 220,000 (D) Dr. A by %16,000; Dr. B by & 4,000; Cr. C by %20,000 HOTS Q. 37. A, B and Care partner sharing profits in the ratio of | :2: 3, On 1-4-2019 they decided to share the profits equally. On the date there was a credit balance of %1,20,000 in their Profit and Loss Account and a balance of %1,80,000 in General Reserve Account. Instead of closing the General Reserve Account and Profit and Loss Account, it is decided to record an adjustment entry for the same. In the necessary adjustment entry to give effect to the above arrangement : ; (A) Dr. A by 250,000; Cr. B by %50,000 (B) Cr. A by %50,000; Dr. B by 750,000 (©) Dr. A by 250.0 38.4, Yand Z are partners ina firm sharing profits in the ratio 4:3: 2 Tht Belance Sheet as at 31-3-2019 shoved a debit balance of Profit & Lass Alt 71,80,000, From 1-4-2019 they will share profits equally. In the necessi Journal entry to give effect to the above arrangement when X, Y and Z decid! Not to close the Profit & Loss Account : HANGE PROFIT SHARING RATIO AMONG Tht icriNG paRtNERS (A) Dr Vy 20,000. Cr 7 hy 820.000 (BY Cr by £20,000, De 7 hs 820,000 «C) De V by 840,000, Cr 7 hs. 40.900 (D) Cr Vy 840,000, Dr 7 hy 840,000. wots 9, 38, Anin and Varun are partners sharing Saaremaa prt pie adi Matar (Goal balee=ol[O U4 oun inl pectic Uses eee ie eee share the future profits equally. Insead of clocing the Goeat tere ‘Account and Profit and loss Accoun, its decided wo ase an areeense for the same. In adjustment entry Pode relia (A) Dr. Arun by 23,000; Cr. Varun by 23,000 (B) Dr. Arun by 5,000; Cr. Varun by ®5,000 (C) Cr. Arun by 25,000; Dr. Varun by &5,000, (D) Cr. Arun by %3,000; Dr. Varun, by 23,000 HOTS (40, X.Y and Z are partners in firm sharing profits in the ratio of 3 21. They decided to share future profits equally. The Profit and Loss Account showed a Credit balance of %60,000 and a General Reserve of 230,000. If these a not to be shown in balance sheet, in the journal entry (A) Cr. V by 215,000; Dr. Z by €15,000 (B) Dr. X by 215,000; Cr. Z by %15,000 (C) Cr. X by 245,000; Cr. ¥ by %30,000; Cr. Z by 215,000. (D) Cr. X’by 830,000; Cr. ¥ by 230,000; Cr. Z by 230,000 profits and losses in the ratio 5:3 : 2. They in the ratio 3:2: 1. Workmen compensation 10 information is Q. 41. ¥, ¥ and Z are partners sha decide to share the future profi reserve appearing in the balance sheet on the date if m available for the same will be (A) Distributed to the partners in old profit sharing ratio (B) Distributed to the partners in new profit sharing ratio (C) Distributed to the partners in capital ratio (D) Carried forward to new balance sheet without any adjustment ners which results in an end of (. 42. Any change in the relationship of existing, partn nev agreement is called the existing agreement and enforces making of (A) Revaluation of partnership. (B) Reconstitution of partnership, (C) Realization of partnership (D) None of the above (CBSE Sample Paper, 2013) [See answers at the end of the book] Admissi 3 on of a P. mn a artne, Multiple Choice Questions 7 Choose the Best Alternate : wtner may be admitted into a partnership : the consent of any one partner the consent of majority of partners the consent of all old partners of old partners Q. 1. Anew pal (A) With (B) With (c) With (D) With the consent of 23rd 2. On the admission of a new partner: (A) Old firm is dissolved (B) Old partnership is dissolved (C) Both old partnership and firm are dissolved () Neither partnership nor firm is dissolved few Profit Sharing Ratios : Calculation of Ne artners sharing profit in the ratio of 3 ; 2. They admit C as a Q.3.4 and B are p sartnerby giving him 13 share in future profits. The new ratio willbe: (A) 12:8:5 (B) 8:12:5 (©) 5:5:12 (D) None of the Above (CS. Foundation, Dee, 2012) ratio of 3 : 2. Z was admitted with 1/4 Q. 4. ¥and Yare partners sharing profit in the from X and ¥. The new ratio will be: share in profits which he acquires equally (A) 9:6:5 (B) 19:11:10 (C)3:3:2 (D)3:2:4 5.4 and B share profits in the ratio of 2 : 1. C is admitted with 1/4 share in profits. C acquires 34 of his share from 4 and 1/4 of his share from B. The new ratio will be: (A)2:1: ati (B) 23:13:12 os : (D) 13:23:12 Band N . aa ieee 4 firm sharing profits inthe ratio of 3 :2. They admit inthe ratio of 11.7 share in the profits. $ acquires his share from B and ns The new profit-sharing ratio will be : (©)3:2:4 (B) 19:26:15 (D) 26:19:15 | — R ss Of One —— - 2 10 Bare arenes sharing profits and losses in the ratio of 7: 5. They agree . mit C, their manager, into partnership who is to get 1/6th share in the 10 a ires this sh: ts, He acquires: tt is share as 1/24th from A and 1/81 e a Sion vatio will be : th from B. The new tay 3:74 (B)7:13:4 756 (D)5:7:6 14 and B share profits in ae re of 3: 2. They agreed to admit C on the condition that A will sacrifice 3th of his share of profit in favour of C and B eal i : , will sacrifice 75% of his profits in favour of C. The new profit sharing ratio will be : (ay 12:94 (B)3:2:4 (C) 66:48:11 (D) 48 66:11 ‘sand Bae partners ina firm sharing profits and losses in the ratio of 3 2. A 4 am artner Cis admitted. A surrenders 1/15th share of hs profit in favour of ae B surrenders 2/15th of his share in favour of C. The new ratio will be : (ays:433 (B) 42:26:7 (4:83 (D) 26: 42:7 Q% Q. 10. Aand Bare partners sharing profit or loss in the ratio of 4: 1. 4 surrenders 1/4 a eins share and B surrenders 1/2 of his share in favour of C, a new partner What will be the C’s share? 1 w3 (eg 1 a Oo ) 79 “and B are partners in a business sharing profits and losses in the ratio of 13 respectively. They admit C as a new partner. sacrificed 1/7th share of 1/3rd of his share in favour of C. The new profit 2 his profit and B sacrificed sharing ratio of 4, B and C will be (A) 3:1: 1 (B) 2:1:1 (C)2:2:1 (D) None of the above (C.S. Foundation, June, 2013) 0.12, A and B are partners sharing profit or loss in the ratio of 3 : 2. Cis admitted into partnership as a new partner. A sacrifices 1/3 of his share of B sacrifices 1/4 of his share in favour of C. What will be the C’s share in the firm? : 2 (A) = ace As By 3 Or (D) None of the above od tI a — AOMSSION FA a ae eee Gai eid al eae . 13, A and B are partners ina firm ith Oe edited for 15 share in the profits of the fim. IfC gets it Wholly §2) the new profit sharing ratio after C’s admission will be : my Can (B)3:1:1 (D)1:3:1 (©) il Beare partners sharing profits in the ratio of 4: 3. They admi Qu. errata at gets 1/Sth share of profit, entirely from H The aa cy sharing ratio will be : Pm (A) 20:8:7 (© 13: 15:7 15.4, BC D ave in partnership sharing profits and losses inthe ra 9:6: 5: 5, £ join the partnership for 20% share. 4, B, C and D youy future share profits among themseves as 3/10 4/10 : 210: 110, edt profit sharing ratio will be: yl ta) 852 ee (B) 9:6:5:5:5 (©) 6:8:4:2:5 (D)8:6:4:2.5 16, 4 and B ae in partnership sharing profits and losses as 3 2. Cis admited Wath share, Aferwards D enters for 20 paisa inthe rupee. The news pt sharing ratio after D's admission will be : (A) 9:6:5:5 (B) 6:9:5:5 (0)3:2:4:5 ( (B) 13:15:15 (D) 15: 13:5 Calculation of Sacrificing Ratio : Q. 17. The formula for calculating the sacrificing ratio is, (A) New share — Old share (B) Old share ~ New share (C) Gaining Ratio ~ Old Ratio (D) Old Ratio - Gaining Ratio Q.18. X and Y are partners sharing profits in the ratio of 3 : 2, Z is admitted asa partner. Calculate sacrificing ratio if new profit sharing ratio is 9-7 +4 (A)3:1 (B) 3:2 (©) 1:3 (D) 9:7 19, : Q 4 and B are partners sharing profits in the ratio ofS: 3 surrenders thf his i share and B surrenders a of his share in favour of C, a new partner. What is the sacrificing ratio? (A) 4:5 (B) (©) 12:25 ©) 20. 4 and B are partners sharing profits in the ratio of 11 +4, C was admited. 4 surrendered 7th of his share and BF of his share in favour of C. T# sacrificing ratio willbe : (A) 1:4 (B) 1:1 4: (D)7:4 4 5 eres apnission’ OFA PARTNER un ni, Pand Qa partners sharing profits in the ratio of 9 ? Ris write . . a partner with ath share in the profits, which he takes dh from P and ith from 0. a ratio will be (ays4 (B) 9:7 (7:9 (D) 4:5 yors Q.2. ‘A, Band C are partners sharing in the ratio of 5 : 4 : 3. They admit D for ith share. It is agreed that B would retain his original share. Sacrificing ratio will be: (A) A, Band C— 5:4:3 (B) Aand C—4:3 (C) AandC—S:4 (D) Aand C—S:3 0.23.4 and B are partners sharing profits and losses in the ratio of 5 : 4. C is admitted for ith share. A and B decide to share equally in future. Sacrificing ratio will be : (Ays:4 (B) 2:7 (7:2 (Dist (Q.24, A and B are partners. They admit C for fa share. In future the ratio between Aand B would be 2 : 1, Sacrificing ratio will be (A)2:1 (B) 1:1 5:1 (D)1:5 Treatment of Goodwill : (0.25. Aand B are partners sharing profits and losses as 2: 1, Cis admitted and profit sharing ratio becomes 4 : 3 : 2. Goodwill is valued at %94,500. C brings required goodwill in cash. Goodwill amount will be Credited to : (A) 4 714,000 and B 7,000 (B) A 212,000 and B %9,000 (C) A 21,000 (D) 4 294,500 26. Xand ¥ are partners sharing profits and losses inthe ratio of 3 : 2. They admit Z.into partnership with 4th share in profits which he acquires equally from X and Y. Z brings in %40,000 as goodwill in cash. Goodwill amount will be credited to (A) X 20,000; ¥ 820,000 (B) X 225,000; ¥ %15,000 (©) X 824,000; ¥ %16,000 (D) XZ 4,000; ¥ & 4,000 2 ADMISSION OFA PAR Al Se ie profits and losses in the ratio of 3 2g 7 ners A and Bae Pane or Uth share in profit. He Pays 71,00,099 | into partnership TO" 5 : admitted ii o ofthe partners A, B and C in the new firm would be 3 ill, The rati ; soo dil will bere to: (B) Only B @1,00,000 (a) only Dein 000 (D) 4 875,000; B 225,000 (C) A 260,000; B %40, . : : oe 28. ae ‘pare partners infirm sharing profits inthe ratio of 2: 1, Cig admit 1 : . Q as.apariner A and B surender of thei respective share in favour of Ch bring his stare of premium for goodwill in cash The goodwill athe fg to bring i (00, Credit will be given to : i ep, e15000 (B) A %40,000; B 220,000 (C) A 830,000; B 30,000 (D) A 20,000; B 210,000 HOTS i fits i io of 3 : 2. Ris i ith 4 Q. 29, P and Sare partners sharing profits in the ratio of is admitted with zt ings in $84,000 as his share of goodwill which is Credited y se Con Acoma of Pand S respectively with 263,000 and 821,000, Ne. profit sharing ratio will be = (A)3:1:5 ()3:2:5 30, Partners 4, B and C share the profits of business in the ratio of 3:2 respectively. They admit D who brings in ¥60,000 for his shate of goodwil, 4.B, Cand D decide to share the profits respectively in the ratio of 5:39 2. Credit will be given to (A) A 6,000; B 26,000 (B) A 830,000; B 718,000; C 12,000 (©) 4 230,000; 8 220,000; C €10,000 (©) 4 830,000; B 230,000 (B) 9:7:4 (D)7:9:4 31. A and B ae partners sharing profits and losses as 2: |. Cand D are admitted and profit sharing ratio becomes 3:2: 4: 1, Goodwill is valued at 90,000. (and bring required goodwill in Cash, Credit will be given to: (A) A 730,000; B 715,000 (B) A %66,000; B %24,000 (C4 333,000; B 712,000 (D) 4 227,000; B tI 8,000 ee Parvers sharing profits and losses in 3 : 2. They admit C into Farneship forth share inthe profits, 4 surrenders 2rd of his share and B Le ore: Senders “th of his share in favour o| 33,00,000 given to fC. Goodwill of the firm is valued at but Cis unable to bring his share of goodwill in cash. Credit will a, | nee oe oe. Q.38 Q.36. Q.37. Q.38, Q.39. cSi0W OF A PARTNER u (ay £8 84,000, BE 36.000 1) 1P 60,000, RF x0.000 iC) 4 £2.00,000, FB E1.00,000 (D) 1 21,80,000. RFT 20,00 {and R ate partners shanng profits in the vot? SC 1s admitted into the partnership for th share which he acquires. th from and th from Mt ¢ docs not pay anything for his share of goodseill On C's admission firm's goodwill was valued at @1,80,000. Credit will he given to (Ay 42 22800 BE 7.500 (By) 62 7,800, 8 & 22,500 (©) 48 48,000, B 21,35,000 (Dy 4.21.35,000, B 245,000 \ and } are partners in a firm sharing profits in the ratio of S 3 They admitted 7 asa new partner The new profit sharing ratio will be 432. The firm’s goodwill on Z's admission was valued at €1,26,000 But 7 could not bring any amount of goodwill in Cash. Credit will be given to (AV V& 17.500, ¥ 210,500 (B) V2 16,000, ¥ 812,000 (CY NX 22,750; ¥ 2 5,250 (Dy 21,02,375, ¥ 823,625 4 and B are partners sharing profits in the ratio of 3. 2. They admit C into the 1 _ partnership with th share in future profits. The new profit sharing ratio is S 4:3. The firm’s goodwill on C's admission was valued at 21,44,000. But ( could not bring any amount for goodwill in Cash, Credit will be given to (A) 4 & 80,000; B 64,000 (B) 4% 20,000; B 216,000 (C) 4 81,05,600; B 238,400 (D) 4% 26,400; B & 9,600 P. Qiand R share profits in the ratio of §: 3 : 2. Sis entitled for Hth share in profits which he acquires equally from P, Q and R. Goodwill of the firm is to be valued at three year" we of last four year’s profits which are 250,000; 760,000; (-) 230,000 and %40,000. 5 cannot bring his share of goodwill in cash, Credit will be given to (A) P 30,000; Q %30,000: R %30,000 (B) P % 6,000; O € 6,000; RF 6,000 (C) P 245,000; Q 227,000; R 18,000 (D) PE 9,000; 0 & 9,000, R & 9,000 When a new partner brings his share of goodwill in cash, the amount is debited to (A) Goodwill Ale (B) Capital A/e of the new partner (C) Cash Ale (D) Capital A/es of the old partners When a new partner does not bring his share of goodwill in cash, the amount is debited to : (A) Cash Alc (B) Premium Ae (C) Current Ave of the new partner (D) Capital Aves of the old partiers Hf, at the time of admission, some profit aind loys account baktnee appears 1 the books, it will be transferred to YY ADS 4 - soso ~~ (A) Profit & Loss Adjustment Account N OF Ay (B) Alll partners” Capital Accounts (C) Old partners’ Capital Accounts a (D) Revaluation Account (crn ng | (40 Ifa the time of admission, there is some unrecorded bil (A) Debited to Revaluation Account (8) Credited to Revaluation Account (C) Debited to Goodwill Account (D) Credited to partners’ Capital Accounts ! iY, it Will be Q. 41. Ifthe new partner brings his share of goodwill in cash, it will be shared by, Of} partners in : (A) Ratio of sacrifice (B) Old profit sharing ratio (C) New profit sharing ratio (D) In Capital ratio HoTs 42. A and B share profits and losses equally. They have 20,000 each as copia) They admit C as equal partner and goodwill was valued at 230,000 Cisy bring in £30,000 as his capital and necessary cash towards hs sae goodwill. Goodwill Account will not remain open in books. I pat revaluation is £13,000, find the closing balance of the capital accounts (A) ®31,500; £31,500; £30,000 (B) %31,500; €31,500; £20,000 (©) %26,500; %26,500; €30,000 _(D) 20,000; 820,000: €30,000 Q. 43. In the absence of an express agreement as to who will contribute to ney partners’ share of profit, it is implied that the old partners will contribute (A) Equally (B) In the ratio of their capitals (C) Intheir old profit sharing ratio (D) In the gaining ratio Q. 44, When a new partner brings goodwill in Cash, it is credited to : (A) His Capital A/c (B) Sacrificing Partner’s Capital As (C) Old Partner’s Capital A/es (D) All Partner’s Capital A/es (Q.45. If the incoming partner brings the amount of goodwill in Cash and also balance exists in goodwill account, then this goodwill account is written off among the old partners in (A) The new profit sharing ratio (B) The old profit sharing ratio (C) The sacrificing ratio (D) The gaining ratio 46. If a the time of admission, the revaluation A/c shows a profit, it shuld credited to (A) Old partners capital accounts in the old profit sharing ratio. (B) All partners capital accounts in the new profit sharing ratio. (©) Old partners capital accounts in the new profit sharing ratio. () Old partners capital accounts in the sacrificing ratio. ee \ jowssio OF A PARTNER a a Juation Account or Profi ae ae 2 (9.47. Reval rofit and Loss Adi i fjustment A/c is a (A) Real Account , (C) Nominal Account e yay foe ceount 1) wots 48. Incase of admission of a partner, the ent . , the entry for unrecorded i . (A) Debit Partners Capital A/es and Credit trunecorded ivesents will be: (B) Debit Revaluation Alc and Credit Investment AVe : (C) Debit Investment A/c and Credit Revaluation A/c (D) None of the above Q. 49. When the balance sheet is prepared after the . wivand liabilities ae recordedat: Hitoership agreement, the (A) Historical cost (B) Current cost (C) Realisable value (D) Revalued figures HOTS 50. Goodwill of a firm of A and B is valued at 30,000. It is appearing i of A an r pppearing in the books at 212,000. C is admitted for 1/4 share. What amount he i bring for goodwill? spies P= newposnite (A) 33,000 (B) 24,500 (© %7,500 (D) %10,500 HOTS 51. A and B are partners of a partnership firm sharing profits in the ratio of 3 : 2 respectively. C was admitted for 1/5th share of profit Machinery would be appreciated by 10% (book value €80,000) and building would be depreciated by 20% (%2,00,000). Unrecorded debtors of %1,250 would be brought into books now and a creditor amounting to %2,750 died and need not pay anything on this account ‘What will be profit/loss on revaluation? (A) Loss %28,000 (B) Loss % 40,000 (C) Profits $28,900 (D) Profits $40,000 HOTS Q 82 3. They admitted Z for 1/Sth | and 30,000 against s capital as base sharing profits in the ratio 5: he paid £60,000 against capital balance for each partner taking Z’ (and Y are partners profits, for which goodwill. Find the capital capital. (A) €1,50,000; 60,000 and 60,000 (B) %1,50,000; 760,000 and %90,000 (C) 21,50,000; %90,000 and 260,000 (D) 1,50,000; £90,000 and 90,000 HOTS Q.53. Ramesh and Suresh are partners respectively. Ramesh Capital is @1 They admit Mahesh and agree to give him | in the ratio of 2: 1 hh Capital is €73,000. future profit. Mahesh sharing profits i 02,000 and Sures! /Sth share in ADMISSION OF 36 _~e-- in 0 as hi g ve ee rie, How much capital will be brought by Mahesh)" © (B) €45,000 ’ 50 (a) 37 (D) 848,000 47,250 or (CS. Foundation sine 2 i i ing capital balances of %54,000 and | and B are partners in a firm having capi 000 and 236, Q.54 aeeatvel. “They admit C in partnership for 1/3rd share and C isto re proportionate amount of capital, The capital amount of Cwouldbe: (B) %45,000 (A) €90,000 (©) 5,400 (D) 236,000 (CS. Foundation, Dee. 201) HOTS : (9.55, A and B are in parnership sharing profits in the ratio of 3:2, They tke Cy fnew pariner. Goodwill of the firm is valued at %3,00,000 and C bring 730,000 as his share of goodwill in cash which is entirely credited tot Capital Account of 4. New profit sharin ratio willbe: (A)3:2:1 (B)6:3:1 (© 5:4:1 (D)4:5:1 HOTS 56, Xand Yare partners sharing profits in the ratio of 4:3. is admitted for Vs Share and he brings in %1,40,000 as his share of goodwill in cash of which 71,20,000 is credited to X and remaining amount to ¥. New profit sharing ratio will be : 23 (B) 2:2:1 (D)2:1:2 HOTS Q.57, A and B are partners sharing profits in the ratio of 2: 3. Their Balance Shee shows Machinery at 2,00,000; Stock at €80,000 and Debtors at $160,000. Cis admitted and new profit sharing ratio is agreed at 6 : 9 : 5. Machinery is revalued at 71,40,000 and a provision is made for doubtful debts @5%. 4s share in oss on revaluation amount to €20,000. Revalued value of Stock will be: (A) 262,000 (B) %1,00,000 (©) 760,000 (D) = 98,000 vy agree to adit Q.58. 4, Band Care partners sharing profits in ratio of 3:2: 1. The’ : yf their D into the firm. A, B and C agreed to give 1/3rd, 1/6th, 1/9th share o} profit. The share of profit of D will be : a i Wp ®) xy 12 Os Oy _ yas OF A PARTE . 5 9, Nand Yate partners sharin prot ithe vate 2 4 Huey adit 7 fr Ture af profits, tor wtich he patel 21 20.000 aint capital and POM, aly tll Fond the capital balances foreach partner tabany Zs capa as have ‘ capital (A) 14,00,000, 71.20.00 and 11 20,000 (18) 84.00.00, 71.20.00 and #1 40,000 (6) 21.92.00, 72.8H,000 and 120,000 ()) 21,00,000, 71,40,000 and #1, 40,000, partners, Aan 60 share remaining profits w the rao of +2. Vind the profit saring Cad D (Ay5:5:4:2 Wy) 11:64 (C) 25.25: 8:6 (D994 CPT, Dee 2014 0.61, Sacrificing, ratio is used to distribute in cave of admisstion of a partner (A) Reserves (1B) Goodwill (C) Revaluation Profit (1)) Balance in Profit and [Loss Account (CPT, Dew 2012) 0.62, Xand Yare partnets in a firm with capital of 21,80,000 and %2,00,000, Z was ‘admitted for [rd share in profits and brings 7,40,000 as capital, calculate the amount of goodwill (A) 22,40,000 (18) 21,00,000 (C) €1,50,000 (Dy 23,00,000, (CPT, June 2012) 0.63, A and B are partners sharing profits and losses in the ratio of 5 3. On admission, C brings 270,000 as cash and 243,000 against Goodwill. New profit ratio between A, Band Cis 7:54. The sacrificing ratio of A and B is (Ay 3:1 (By 133 (C455 (0) 5:9 (CPT: Dec. 2012) [See answers at the end of the book] B 4 Retirement or Death of a Partner Multiple Choice Questions Sctect the Best Alternate Q. 1 Renning partner is compensated for parting with the firm's future Profits in favour of remaining partners The remaining partners contribute to such compensation amount in (A) Gaining Ratio (B) Capital Ratio Sacrificing Ratio {D) Profit Sharing Ratio (CS. Foundation Dec 2013, ( Q. 2. Gaining Ratio’ means (A) Olid Ratio — New Ratio (B) New Ratio - Old Ratio C) Old Ratio Sacrificing Ratio (D) New Ratio ~ Sacrificing Ratio Q. 3. What treatment is made of accumulated profits and losses on the retirement of a partner (A) Credited to all partner's capital accounts in old ratio (B) Debited to all partner's capital accounts in old ratio, (C) Credited to remaining partner's capital accounts in new ratio, (D) Credited to remaining partner's capital accounts in gaining ratio (. 4 At the time of retirement of a partner, profit on revaluation will be credited to (A) Capital Account of retiring partner (18) Capital Aecounts of all partners in the old profit sharing ratio ‘C) Capital Accounts of the remaining partners in their old profit sharing ratio (1) Capital Accounts of the remaining partners in their new profit sharing ratio Q.S. What journal entry will be recorded for writing off the goodwill already existing in Balance Sheet at the time of retirement of a partner? (A) Reuring Partner's Capital Ave De to Goodwill Ave (By All Partner's Capital Aves (including retisingy Dr (an od ratio) To Goodwill Ac (©) Remaining Partner's Capital Aves Dean gang ae? Fo Goodwill Ave (Dy Remaining Pariner’s Capital Ales Dr. ain new ratio) Jo Goodwill Ac yr ENT OR DEATH OF A PARTNER pe TiREM 39 6, What journal entry willbe recorded for deceased partners share in profit from the closure of last balance sheet till the date of his death? (A) Profit and Loss Ale Dr. ‘To Deceased Partner’s Capital A/e (B) Deceased Partner's Capital A/c Dr, To Profit and Loss Ale (©) Deceased Partner’s Capital A/e Dr. To Profit and Loss Suspense A/c (D) Profit and Loss Suspense A/c Dr. To Deceased Partner’s Capital A/c Q. 7. On retirement of a partner, goodwill will be credited to the Capital Account of: (A) Retiring Partner (B) Remaining Partners (©) All Partners (D) None of the Above Q.8. On the death of a partner, the amount due to him will be credited to (A) All partner’s Capital Accounts (B) Remaining partner's Capital Accounts (C) His Executor’s Account (D) Governments’ Revenue Account Q. 9. How goodwill is recorded on the retirement of a partner? (A) Remaining Partner's Capital Ales Dr. (In Gaining Ratio) To Retiring Partner's Capital Ale (with his share of goodwill) (B) Remaining Partner's Capital A/es Dr. (In New Ratio) To Retiring Partner's Capital Alc (with his share of goodwill) (C) Goodwill Ale Dr. To All Partner’s Capital A/es (In Old Ratio) (D) Goodwill A/c Dr. ‘To Retiring Partner’s Capital Ale (with his share) Q. 10. A, Band Care partners in 3 : 4: 2. B wants to retire from the firm. The profit

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