Question 38.

Z is admitted in a firm for al/4 share in the profit for which he brings 7 30,000 for
goodwill. It will be taken away by the old partners X and Y in :
(a) Old profit-sharing ratio
(b) New profit-sharing ratio
(c) Sacrificing ratio
(d) Capital ratio

Answer
Answer: (c) Sacrificing ratio

Question 39.
General Reserval at the time of admission of a new partner is transferred to :
(a) Revaluation Account
(b) Old Partner’s Capital Account
(c) Profit and Loss Adjustment Account
(d) Realisation Account

Answer
Answer: (b) Old Partner’s Capital Account

Question 40.
Change in profit-sharing ratio of existing partners results in:
(a) Revaluation of Firm
(b) Reconstitutions of Firm
(c) Dissolution of Firm
(d) None of these

Answer
Answer: (b) Reconstitutions of Firm
Question 41.
X, Y and Z are partners in a firm, they divided profit and loss in the ratio of 4:3:1. They
decided to share profit In the ratio 5:4:3. X’s and Y’s sacrifices are :
(a) 224:124
(b) 124:324
(c) 224:324
(d) None of these
Answer
Answer: (a) 224:124

Question 42.
On reconstitution of a partnership firm, recording of an unrecorded liability wil result
in:
(a) Gain to the existing partners
(b) Loss to the existing partners
(c) Neither gain nor loss to the existing partners
(d) None of these

Answer
Answer: (b) Loss to the existing partners

Question 43.
Increase In the value of assets on reconstitution of the partnership firm results into :
(a) Gain to the existing partners
(b) Loss to the existing partners
(c) Neither gain nor loss to the existing partners
(d) None of these

Answer
Answer: (a) Gain to the existing partners
Question 44.
The balance of Revaluation Account is transferred to old Partner’s Capital Accounts
in their:
(a) Old Profit-sharing Ratio
(b) New Profit-sharing Ratio
(c) Equal Ratio
(d) None of these

Answer
Answer: (a) Old Profit-sharing Ratio

Question 45.
X and Y share profits in the ratio 2 :3. In future they have decided to share profits in
equal ratio. Which partner will sacrifice in which ratio ?
(a) X sacrifice 1/10
(b) Y sacrifice 1/5
(c) Y sacrifice 1/10
(d) None of these

Answer
Answer: (c) Y sacrifice 1/10

Question 46.
Change in the partnership agreement results in:
(a) Reconstitution of Firm
(b) Dissolution of Firm
(c) Amalgamation of Firm
(d) None of these

Answer
Answer: (a) Reconstitution of Firm
Question 47.
Change in the partnership agreement:
(a) Changes the relationship among the partners
(b) Results in end of partnership business
(c) Dissolves the partnership firm
(d) None of these

Answer
Answer: (a) Changes the relationship among the partners

Question 48.
Excess of credit side over the debit side in Revalution Account is:
(a) Profit
(b) Loss
(c) Receipt
(d) Expense

Answer
Answer: (a) Profit

Question 49.
A, B and C are partners in a firm, if D is admitted as a new partner:
(a) Old firm is dissolved
(b) Old firm and old partnership are dissolved
(c) Old partnership is reconstituted
(d) None of these

Answer
Answer: (c) Old partnership is reconstituted
Question 50.
Recording of an unrecorded asset on the reconstltutlam of a partnership firm will be:
(a) A gain to the existing partners
(b) A loss to the existing partners
(c) Neither a gain nor a loss to the existing partners
(d) None of these

Answer
Answer: (a) A gain to the existing partners

Question 51.
Revaluation Account or Profit & Loss Adjustment Account is a:
(a) Personal Account
(b) Real Account
(c) Nominal Account
(d) None of these

Answer
Answer: (c) Nominal Account

Question 52.
A, B, C and D are partners sharing their profits and losses equally. They change their
profit sharing ratio to 2:2:1:1. How much will C sacrifice ?
(a) 1/6
(b) 1/12
(c) 1/24
(d) None of these

Answer
Answer: (d) None of these
Question 53.
Sacrificing Ratio:
(a) New Ratio – Old Ratio
(b) Old Ratio – New Ratio
(c) Gaining Ratio – Old Ratio
(d) Old Ratio – Gaining Ratio

Answer
Answer: (b) Old Ratio – New Ratio

Question 54.
Gaining Ratio:
(a) New Ratio – Old Ratio
(b) Old Ratio – Sacrificing Ratio
(c) New Ratio – Sacrificing Ratio
(d) Old Ratio – New Ratio