CBSE Class 12 Accountancy Admission Of A Partner MCQs

Question: Sacrificing ratio is ascertained at the time of

a) Admission of a new partner

b) Death of partner

c) Retirement of partner

d) None of the options

Answer: Admission of a new partner

Question: share of goodwill brought in by new partner in cash is shared by old partners in

a) Sacrificing ration

b) Old ratio

c) New ratio

d) All of the options

Answer: Sacrificing ration

Question: Excess of the credit side over the debit side of revaluation account

a) Profit

b) Loss

c) Gain

d) Expense

Answer: Profit

Question: Balance sheet prepared after new partnership agreement, assets and liabilities are recorded at

a) Revalued figure

b) Original value

c) At realisable value

d) None of the options

Answer: Revalued figure

Question: Share of goodwill brought in by new partner in cash is called

a) Premium

b) Profit

c) Assets

d) Liabilities

Answer: Premium

Question: Profit or loss on revaluation is borne by

a) Old Partners

b) New partners

c) All partners

d) All of the options

Answer: Old Partners

Question: When the new partners pays for goodwill in cash, the amount should be debited in the firms book to

a) Cash A/c

b) Goodwill A/c

c) Capital Account

d) All of the options

Answer: Cash A/c

Question: When is brought in cash by the new partner, then the method is known as

a) Premium Method

b) Revaluation Method

c) Memorandum Revaluation Method

d) None of the options

Answer: Premium Method

Question: On the admission of a new partner, if goodwill account is to be raised then this should be debited to

a) Goodwill Account

b) Old Partners capital Account

c) Profit & Loss Appropriation A/c

d) None of the options

Answer: Goodwill Account

Question: When we use super profit Method for goodwill Valuation

a) Firm earns higher Profit

b) Firm earns normal Profit

c) Average profit

d) None of the options

Answer: firm earns higher Profit 

Question: Any change in agreement of partnership is called

a) Reconstitution of partnership firm

b) Dissolution of partnership firm

c) Reconstitution of partners

d) None of the options

Answer: Reconstitution of partnership firm

Question: Which circumstances a partnership firm may be reconstituted

a) All of the options

b) Admission of a partner

c) Retirement/Death of a partner

d) Change in Profit Sharing Ratio

Answer: All of the options

Question: At the time of admission of a new partner, Which adjustments are required

a) All of the options

b) Accounting treatment of Goodwill.

c) Accounting treatment of accumulated profit.

d) Calculation of new profit sharing ratio and sacrificing ratio.

Answer: All of the options

Question: At the time of admission of a new partner, Which adjustments are required

a) Calculation of new profit sharing ratio and sacrificing ratio.

b) Accounting treatment of Goodwill.

c) Accounting treatment of accumulated profit.

d) All of the options

Answer: Calculation of new profit sharing ratio and sacrificing ratio.

Question: Profit Sharing ratio is the ration in which the partners have agreed to share

a) Profit & Losses

b) Profit only

c) Losses only

d) None of the options

Answer: Profit & Losses

Question: In guarantee of profit, given to a partner

a) Minimum Guarantee profit

b) Equal Profit

c) 0.25

d) None of the options

Answer: Minimum Guarantee profit

Question: In the partnership, every partner has the right to

a) Both

b) Consulted about the business

c) Participate in management

d) None of the options

Answer: Both

Question: Which clause should be mentioned in partnership deed

a) All of the options

b) Description of Firms

c) Nature of business

d) Description of partners

Answer: All of the options

Question: in the absence of partnership deed, Interest on Capital and drawing to be

a) Not paid

b) Paid

c) 6% p.a

d) None of the options

Answer: Not paid

Question: a partner may retire from firm

a) Both

b) With an Express agreement among the partners

c) With the consent of all the partners

d) None of the options

Answer: Both

Question: The interest on capital account of partners under the fluctuating capital account method credited to

a) Partners capital account

b) Interest account

c) Profit & Loss A/c

d) None of the options

Answer: Partners capital account

Question: In the absence of agreement to the contrary , partners share profit and losses in the

a) Equal ratio

b) Rate of average capital

c) 0.25

d) None of the options

Answer: Equal ratio

Question: Partners Salary is debited to

a) Profit & loss Appropriation A/c

b) Profit & loss A/c

c) Revaluation A/c

d) None of the options

Answer: Profit & loss Appropriation A/c

Question: Which items may appear on the credit side of the partners current account

a) Interest on Capital

b) Salary

c) Commission

d) All of the options

Answer: Interest on Capital

Question: If the partners capital account are fixed , Commission payable to partner will show

a) Cr. Side of current A/C

b) Dr. Side of current A/C

c) Both

d) None of the options

Answer: Cr. Side of current A/C

Question: The firm number of partner increase

a) Admission of a new partner

b) Dissolution of a new partner

c) Retirement of new partner

d) Death of new partner

Answer: Admission of a new partner

Question: If partners capitals are fixed, premium for goodwill will be:

a) Credited to the current A/cs of the Sacrificing partners

b) Credited to the Partners Capital A/cs

c) Credited to the P/L Adjustment A/c

d) None of the options

Answer: Credited to the current A/cs of the Sacrificing partners

Question: When the incoming partner pays his share of goodwill privately to the sacrificing partner outside the business Which account should be debited in the books of account

a) No entry should be recorded

b) Premium for goodwill A/c

c) Partners capital A/c

d) None of the options

Answer: No entry should be recorded

Question: If a new partner is admitted during the year the profits for the year should be divided between ____ period on an agreed basis

a) Pre-admission and post admission

b) Old profit sharing

c) Equal

d) None of the options

Answer: Pre-admission and post admission

Question: Which of following account is prepared at the time of admission of a new partner?

a) Revaluation Account

b) Realisation Account

c) Profit & loss A/c

d) None of the options

Answer: Revaluation Account 

Question: A and B are partners sharing profits and losses in the ratio of 7 : 5. They agree to admit C, their manager, into partnership who is to get l/6th share in the profits. He acquires this share as l/24th from A and l/8th from B. The new profit sharing ratio will be :

(a) 13:7:4

(b) 7 : 13 : 4

(c) 7 : 5 : 6

(d) 5 ; 7 : 6

 Answer: A

Question: A and B share profits in the ratio of 3 : 2. They agreed to admit C on the condition that A will sacrifice —th of his share of profit in favour of C and B will sacrifice yrth of his profits in favour of C. The new profit sharing ratio will be :

(a) 12 : 9 : 4

(b) 3 : 2 : 4

(c) 66:48: 11

(d) 48: 66: 11

 Answer: C

Question: A and B are partners in a firm sharing profits and losses in the ratio of 3 : 2. A new partner C is admitted. A surrenders 1/15th share of his profit in favour of C and B surrenders 2/15th of his share in favour of C. The new ratio will be :

(a) 8 : 4 : 3

(b) 42 : 26 : 7

(c) 4 : 8 : 3

(d) 26 : 42 : 7

Answer: B

Question: A and B are partners sharing profits and losses as 2 : 1. C is admitted and profit sharing ratio becomes 4:3:2. Goodwill is valued at Rs.94,500. C brings required goodwill in cash. Goodwill amount will be Credited to :

(a) A 114,000 and B Rs. 7,000

(b) A Rs. 12,000 and B Rs. 9,000

(c) A Rs.21,000

(d) A Rs.94,500

Answer: C

Question: X and Y are partners sharing profits and losses in the ratio of 3 : 2. They admit Z into partnership with |th share in profits which he acquires equally from X and Y. Z brings in Rs.40,000 as goodwill in cash. Goodwill amount will be credited to :

(a) X Rs.20,000; Y Rs.20,000

(b) X Rs.25,000; Y Rs.15,000

(c) X Rs.24,000; Y Rs. 16,000

(d) X Rs. 4,000; Y Rs. 4,000

Answer: A

Question: 4 and 5 are partners sharing profits in the ratio of 7 : 5. C is admitted into the partnership for 1/6th share which he acquires 1/24th from A and 1/8fh from B. C does not pay anything for his share of goodwill. On C’s admission firm’s goodwill was valued at Rs. 1,80,000. Credit will be given to :

(a) A Rs. 22,500; B Rs. 7,500

(b) A Rs. 7,500; B Rs. 22,500

(c) A Rs. 45,000; B Rs. 1,35,000

(d) A Rs.1,35,000; B Rs. 45,000

Answer: B

Question: X and Y are partners in a firm sharing profits in the ratio of 5 : 3. They admitted Z as a new partner. The new profit sharing ratio will be 4 : 3 : 2. The firm’s goodwill on Z’s admission was valued at Rs. 1,26,000. But Z could not bring any amount of goodwill in Cash. Credit will be given to :

(a) X Rs. 17,500; Y Rs.10,500

(b) X Rs. 16,000; Y Rs.12,000

(c) X Rs. 22,750; Y Rs. 5,250

(d) X Rs. 1,02,375; Y Rs.23,625

 Answer: C

Question: A and B are partners sharing profits in the ratio of 3 : 2. They admit C into the partnership with 1/4th share in future profits. The new profit sharing ratio is 5 : 4 : 3. The firm’s goodwill on C’s admission was valued at Rs. 1,44,000. But C could not bring any amount for goodwill in Cash. Credit will be given to :

(a) A Rs. 80,000; B Rs.64,000

(b) A Rs. 20,000; B Rs. 16,000

(c) A Rs. 1,05,600; B Rs.38,400

(d) A Rs. 26,400; B Rs. 9,600

Answer: D

Question: A and B are sharing profits and losses in the ratio of 3: 2. They admit C as a partner and give him 2/10th share in the profits. The new profit-sharing ratio will be

(a) 12:8:5.

(b) 3:2:2.

(c) 3:2:5.

(d) 2:1:2.

 Answer: A

Question: A and B are sharing profits and losses in the ratio of 5: 3. They admit C as a partner and give him 3/10th share of the profits. This share he will get 1 /5th from A and 1/10th from B. The new profit-sharing ratio will be

(a) 5:6:3.

(b) 2:4:6.

(c) 17:11:12.

(d) 18:24:38.

 Answer: C

Question: Profit or Loss on revaluation of assets and reassessment of liabilities is transferred to Partners' Capital Accounts in their

(a) Capital Ratio.

(b) Equal Ratio.

(c) Old Profit-sharing Ratio.

(d) Gaining Ratio.

Answer: C

Question: Goodwill of a firm of A and B is valued at Rs.30,000. It is appearing in the books at Rs. 12,000. C is admitted for 1/4 share. What amount he is supposed to bring for goodwill?

(a) Rs.3,000

(b) Rs.4,500

(c) Rs.7,500

(d) Rs. 10,500

Answer: C

Question: P and Q are partners in a firm having capitals of Rs. 15,000 each. R is admitted for 1/3rd share for which he has to bring Rs. 20,000 for his share of capital. The amount of goodwill will be

(a) Rs. 8,000.

(b) Rs. 10,000.

(c) Rs. 9,000.

(d) Rs. 11,000.

 Answer: B

Question: When the new partner brings cash for goodwill, the amount is credited to

(a) Revaluation Account.

(b) Cash Account.

(c) Premium for Goodwill Account.

(d) Realisation Account.

Answer: C

Question: At the time of admission, if the profit-sharing ratio among the old partners does not change then sacrificing ratio will be

(a) equal.

(b) according to the contribution of capital.

(c) their old profit-sharing ratio.

(d) according to new partner.

Answer: C

Question: If the new partner brings his share of goodwill in cash, it will be shared by old partners in :

(a) Ratio of sacrifice

(b) Old profit-sharing ratio

(c) New profit-sharing ratio

(d) In Capital ratio

Answer: A

Question: A and B share profits and losses equally. They have Rs.20,000 each as capital. They admit C as equal partner and goodwill was valued at Rs.30,000. C is to bring in Rs.30,000 as his capital and necessary cash towards his share of goodwill. Goodwill Account will not remain open in books. If profit on revaluation is Rs. 13,000, find the closing balance of the capital accounts.

(a) Rs.31,500; Rs.31,500; Rs.30,000

(b) Rs.31,500; Rs.31,500; Rs.20,000

(c) Rs.26,500; Rs.26,500; Rs.30,000

(d) Rs.20,000; Rs.20,000; Rs.30,000

 Answer: A

Question: In the absence of an express agreement as to who will contribute to new partners’ share of profit, it is implied that the old partners will contribute :

(a) Equally

(b) In the ratio of their capitals

(c) In their old profit-sharing ratio

(d) In the gaining ratio

Answer: C

Question: A and B are partners sharing profit in the ratio of 3 : 2. They admit C as a partner by giving him 1/3 share in future profits. The new ratio will be :

(a) 12: 8:5

(b) 8: 12 : 5

(c) 5:5:12

(d) None of the Above

 Answer: D

Question: X and Y are partners sharing profit in the ratio of 3 : 2. Z was admitted with 1/4 share in profits which he acquires equally from X and Y. The new ratio will be:

(a) 9:6: 5

(b) 19: 11: 10

(c) 3 : 3 : 2

(d) 3 : 2 : 4

 Answer: B

Question: A and B share profits in the ratio of 2 : 1. C is admitted with 1/4 share in profits. C acquires 3/4 of his share from A and 1/4 of his share from B. The new ratio will be:

(a) 2 : 1 : 1

(b) 23 : 13 : 12

(c) 3:1:1

(d) 13 : 23 : 12

Answer: B

Question: A and B are partners in a firm sharing profits in the ratio of 2 : 1. C is admitted as a partner. A and B surrender 1/2 of their respective share in favour of C. C is to bring his share of premium for goodwill in cash. The goodwill of the firm is estimated at Rs. 60,000. Credit will be given to :

(a) A Rs. 15,000; B Rs. 15,000

(b) A Rs.40,000; B Rs. 20,000

(c) A Rs.30,000; B Rs. 30,000

(d) A Rs.20,000; B Rs. 10,000

 Answer: D

Question: P and S are partners sharing profits in the ratio of 3 : 2. R is admitted with 1/5th share and he brings in Rs.84,000 as his share of goodwill which is Credited to the Capital Accounts of P and S respectively with Rs.63,000 and Rs.21,000. New profit sharing ratio will be :

(a) 3 : 1 : 5

(b) 9 : 7 : 4

(c) 3 : 2 : 5

(d) 7 : 9 : 4

Answer: B

Question: Partners A, B and C share the profits of a business in the ratio of 3 : 2 : 1 respectively. They admit D who brings in Rs.60,000 for his share of goodwill. A, B, C and D decide to share the profits respectively in the ratio of 5 : 3 : 2 : 2. Credit will be given to :

(a) A Rs. 6,000; B Rs.6,000

(b) A Rs.30,000; B Rs. 18,000; C Rs. 12,000

(c) A Rs.30,000; B Rs.20,000; C Rs. 10,000

(d) A Rs.30,000; B Rs.30,000

Answer: D

Question: A new partner may be admitted into a partnership ;

(a) With the consent of any one partner

(b) With the consent of majority of partners

(c) With the consent of all old partners

(d) With the consent of 2/3rd of old partners

 Answer: C

Question: 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

(d) Neither partnership nor firm is dissolved

Answer: C

Question: B and N are partners in a firm sharing profits in the ratio of 3 : 2. They admit S as a partner for l/4th share in the profits. S acquires his share from B and N in the ratio of 2 : 1. The new profit-sharing ratio will be :

(a) 2:1:4

(b) 19: 26: 15

(c) 3:2:4

(d) 26: 19: 15

Answer: D

Question: Unrecorded assets or liabilities are transferred to

(a) Partners’ Capital Accounts.

(b) Revaluation Account.

(c) Profit and Loss Account.

(d) Partners' Current Accounts.

 Answer: B

Question: X and Y are partners sharing profits in the ratio of 3: 2, and capitals as Rs. 100,000 and Rs. 50,000 respectively. Z is admitted for 1/5th share in profits. The amount Z will contribute as capital will be

(a) Rs. 50,000.

(b) Rs. 35,000.

(c) Rs. 37,500.

(d) Rs. 60,000.

 Answer: C

Question: X and Y are partners sharing profits and losses in the ratio of 3:2. Z was admitted for the 1/5th share and for this he brings Rs. 150,000, as capital. If capitals are to be proportionate to profit-sharing ratio, the respective capitals of the partners will be

(a) Rs. 3,00,000: Rs. 3,00,000: Rs.1,50,000.

(b) Rs. 3,60,000: Rs. 2,40,000: Rs. 1,50,000.

(c) Rs. 1,50,000: Rs.' 1,50,000: Rs. 1,50,000.

(d) Rs. 1,50,000: Rs. 2,00,000: Rs. 4,00,000.

Answer: B

Question: Revaluation Account or Profit and Loss Adjustment A/c is a

(a) Real Account

(b) Personal Account

(c) Nominal Account

(d) Asset Account

 Answer: C

Question: In case of admission of a partner, the entry for unrecorded investments will be:

(a) Debit Partners Capital A/cs and Credit Investments A/c

(b) Debit Revaluation A/c and Credit Investment A/c

(c) Debit Investment A/c and Credit Revaluation A/c

(d) None of the above

 Answer: C

Question: When the balance sheet is prepared after the new partnership agreement, the assets and liabilities are recorded at:

(a) Historical cost

(b) Current cost

(c) Realisable value

(d) Revalued figures

Answer: D

Q. 12. A and B are partners sharing profit or loss in the ratio of 3 : 2. C is admitted into partnership as a new partner. A sacrifice 1/3 of his share of B sacrifice 1/4 of his share in favour of C. What will be the C’s share in the firm?

(a) 1/5

(b) 2/10

(c) 3/10

(d) None of the above

 Answer: C

Question: A and B are partners in a firm sharing profits and losses in the ratio of 2 : 3. C is admitted for 1/5 share in the profits of the firm. If C gets it wholly from A, the new profit sharing ratio after C’s admission will be :

(a) 1 : 3 : 3

(b) 3 : 1 : 1

(c) 2 : 2 : 1

(d) 1 : 3 : 1

 Answer: D

Question: A and B are partners sharing profits in the ratio of 4 : 3. They admitted C as a new partner who gets l/5th share of profit, entirely from A. The new profit sharing ratio will be :

(a) 20: 8:7

(b) 13 : 15 : 15

(c) 13 : 15 : 7

(d) 15 : 13 : 5

Answer: C

Question: A and B are partners sharing profits and losses in the ratio of 5 : 4. C is 1 admitted for 1/5th share. A and B decide to share equally in future. Sacrificing ratio will be:

(a) 5 :4

(c) 2 : 7

(c) 7 : 2

(d) 1 : 1

 Answer: C

Question: A and B are partners. They admit C for 1/3rd share. In future the ratio between A and B would be 2 : 1. Sacrificing ratio will be :

(a) 2:1

(b) 1 : 1

(c) 5 : 1

(d) 1 : 5

Answer: D

Question: When a new partner is admitted, the balance of General Reserve appearing in the Balance Sheet at the time of admission is credited to

(a) Profit and Loss Appropriation Account.

(b) Capital Accounts of all the partners.

(c) Capital Accounts of Old Partners.

(d) Revaluation Account.

 Answer: C

Question: If X pays Rs. 1,50,000 as his share of goodwill to Y (Privately), an existing partner* the treatment will be

(a) Goodwill Account will be debited by Rs. 1,50,000.

(b) Goodwill Account will be debited byRs.6,00,000.

(c) Goodwill Account will be credited by Rs. 1,50,000.

(d) No entry will be passed.

Answer: D

Question: If the incoming partner brings the amount of goodwill in Cash and also a 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

Answer: B

Question: If, at the time of admission, the revaluation A/c shows a profit, it should be credited to :

(a) Old partners capital accounts in the old profit-sharing ratio.

(b) All partners capital accounts in the new profit-sharing ratio.

(c) Old partners capital accounts in the new profit-sharing ratio.

(d) Old partners capital accounts in the sacrificing ratio.

Answer: A

Question: A and B are partners sharing profits in the ratio of 11 : 4. C was admitted. A surrendered 1/11th of his share and B1/4 of his share in favour of C. The 11 : 4 sacrificing ratio will be :

(a) 11:4

(b) 1 : 1

(c) 4:11

(d) 7 : 4

 Answer: B

Question: P and 0 are partners sharing profits in the ratio of 9 : 7. R is admitted as a partner with 9/20 th share in the profits, which he takes 1/5th from P and 1/4th from Q. Sacrificing ratio will be :

(a) 5 : 4

(b) 9 : 7

(c) 7 : 9

(d) 4 : 5

 Answer: D

Question: A, B and C are partners sharing in the ratio of 5 : 4 : 3. They admit D for 1/7 th share. It is agreed that B would retain his original share. Sacrificing ratio will be :

(a) A, B and C - 5:4:3

(b) A and C -4 : 3

(c) A and C - 5:4

(d) A and C - -5:3

Answer: D

Question: When a new partner does not bring his share of goodwill in cash, the amount is debited to :

(a) Cash A/c

(b) Premium A/c

(c) Current A/c of the new partner

(d) Capital A/cs of the old partners

 Answer: C

Question: If, at the time of admission, some profit and loss account balance appears in the books, it will be transferred to :

(a) Profit & Loss Adjustment Account

(b) All partners’ Capital Accounts

(c) Old partners’ Capital Accounts

(d) Revaluation Account

Answer: C

Question: A and B are partners sharing profit or loss in the ratio of 4 : 1. A surrenders 1/4 of his share and B surrenders 1/2 of his share in favour of C, a new partner. What will be the C’s share?

(a) 3/4

(b) 1/5

(c) 1/10

(d) 3/10

 Answer: D

Question: A and B are partners in a business sharing profits and losses in the ratio of 7 : 3 respectively. They admit C as a new partner. A sacrificed l/7th share of his profit and B sacrificed l/3rd of his share in favour of C. The new profit-sharing ratio of A, B and C will be:

(a) 3:1:1

(b) 2 : 1 : 1

(c) 2:2:1

(d) None of the above

Answer: A

Question: A and B are partners of a partnership firm sharing profits in the ratio of 3 : 2 respectively. C was admitted for l/5th share of profit. Machinery would be appreciated by 10% (book value Rs. 80,000) and building would be depreciated by 20% (Rs.2,00,000). Unrecorded debtors of Rs. 1,250 would be brought into books now and a creditor Amounting to Rs.2,750 died and need not pay anything on this account. What will be profit/loss on revaluation?

(a) Loss Rs.28,000

(b) Loss Rs. 40,000

(c) Profits Rs.28,000

(d) Profits Rs.40,000

Answer: A

Question:  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

(c) Reserve

(d) Goodwill

Answer : D

Question: A and B are partners sharing profits in the ratio of 3:2. They changed their profit sharing ratio to 2:3 w.e.f 1st April,2021. The Balance Sheet as on the date of change in profit sharing ratio showed credit balance in profit and loss a/c of Rs.1,00,000,which the partners decide to carry forward and not distribute. The balance of Rs.1,00,000 will be adjusted by

(a) crediting A’s capital a/c and debiting B’s capital a/c by Rs.1,00,000

(b) crediting A’s capital a/c and debiting B’s capital a/c by Rs.20,000

(d) debiting A’s capital a/c and debiting B’s capital a/c by Rs.1,00,000

(b) debiting A’s capital a/c and debiting B’s capital a/c by Rs.20,000

Answer : B

Question: Assets are revalued and liabilities are reassessed at the time of change in profit sharing ratio so that

(a) assets and liabilities are shown at their present values

(b) no partner is put to an advantage or disadvantage

(c) sacrificing partner is partly compensated

(d) assets and liabilities are shown at their market value.

Answer : B

Question: A and B are partners in a firm sharing profits in the ratio of 3 : 2. They decided to share fu-ture profits equally. Calculate A’s gain or sacrifice

(a) 2/10 (sacrifice)

(b) 5/10 (gain)

(c) 1/10 (Gain)

(d) 1/10 (sacrifice)

Answer : D

Question: A,B and C are partners sharing profits in the ratio of 5:3:2. They decided to share future profits in the ratio of 2:3:5. Workmen compensation Reserve appearing in Balance Sheet on that date when no information as to workmen compensation claim is given will be

(a) distributed among partners in their capital ratio

(b) distributed among partners in their new profit sharing ratio

(c) distributed among partners in their old profit sharing ratio.

(d) carried forward to new Balance Sheet.

Answer : C

Question: In case of change in profit-sharing ratio, the accumulated profits are distributed to the partners in

(a) new ratio

(b) old ratio

(c) sacrificing ratio

(d) equal ratio

Answer : B

Question: In which of the following situation, partner’s capital a/c is credited?

(a) Transfer of accumulated profit or reserves

(b) Transfer of revaluation loss

(c) Writing off the existing book value of goodwill

(d) All of the above

Answer : A

Question: A,B and C were are partners in a firm sharing profits in the ratio of 3:4:1 .They decided to share profits equally w.e.f from 1 .4.2019. On that date the profit and loss account showed the credit balance of 96,000.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 20,000

(c) Cr. A by 16,000; Cr. B by 4,000; Dr C by 20,000

(d) Dr. A by 16,000; Dr. B by 4,000; Cr C by 20,000

Answer : B

Question: Out of the following which is not a part of change in profit sharing ratio

(a) Determination of sacrificing and gaining ratio

(b) Accounting of goodwill

(c) Accounting of reserves, accumulated profits and losses

(d) Dissolution of partnership firm

Answer : D

Question: In case of change in profit-sharing ratio, the gaining partner must compensate the sacrificing partners by paying the proportional amount of

(a) capital

(b) cash

(c) goodwill

(d) none of the above

Answer : C

Question: Ankita and Neha are sharing profits in the ratio of 2:1.Now they have decided that new profit sharing ratio will be equal. What will be the Gain/Sacrifice ratio?

(a) Ankitagain1/6and Nehasacrifice1/6

(b) Ankitasacrifice1/6andNehagain1/6

(c)Ankita gain 4/5 and Neha sacrifice 4/5

(d)Ankitasacrifice2/3andNehagain1/6

Answer : B

Question: Any change in the relationship of existing partners which results in an end of the existing agreement and enforces making of new· agreement is called:

(a) Revaluation of partnership

(b) Reconstitution of partnership

(c) Realisation of partnership

(d) None of the above

Answer : B

Question: A partnership is reconstituted due to change in profit sharing ratio.State whether True or False

Answer : Troe

Question: A,B and C are sharing profits in the ratio of 3:2:1.They decided to share equally in future .B’s has neither sacrificed nor gained . State whether True or False

Answer : Troe

Question: ncrease in the value of assets and decrease in the value of liabilities result in ……………for the existing partners and should be ……….to P/L Adjustment a/c

Answer : Gain Credited