CBSE Class 12 Accountancy Admission Of Partner Worksheet Set B

MCQ Questions for NCERT Class 12 Accountancy Admission Of Partner

Question. The profit sharing ratio of Seeema and Ghosh was 5:3. They admitted Munmun as a new partner and the new profit sharing ratio of Seema, Gosh and Munmun was 4:3:3. The sacrificing ratio Seem and Gosh will be:
(a) 5:3
(b) 4:3
(c) 1:1
(d) 3:1

Answer: D

Question. As per ---------, only purchased goodwill can be shown in the Balance Sheet.
(a) AS 37
(b) AS 26
(c) Section 37
(d) AS 37

Answer: B

Question. On the admission of a new partner increase in the value of assets is debited to :
(a) Profit and loss adjustment account
(b) Assets account
(c) Old partners’ capital account
(d) None of the above

Answer: B

Question. At the time of admission of a partner, undistributed profits appearing in the balance sheet of the old firm is transferred to the capital accounts of :
(a) Old partners in old profit sharing ratio
(b) Old partners in new profit sharing ratio
(c) All the partner in the new profit sharing ratio
(d) None of the above

Answer: B

Question. The firm of P, Q and R with profit sharing ratio of 6:3:1, had the balance in General Reserve Account amounting Rs. 1,80,000. S joined as a new partner and the new profit sharing ratio was decided to be 3:3:3:1. Partners decide to keep the General Reserve unchanged in the books of accounts. The effect will be:
(a) P will be credited by Rs. 54,000
(b) P will be debited by Rs. 54,000
(c) P will be credited by Rs. 36.000
(d) P will be credited by Rs. 36,000

Answer: A

Question. Ramesh and Suresh are partners sharing profits in the ratio of 2:1 respectively. Ramesh’s capital is Rs.102000 and Suresh capital is Rs.73000. they admit Mahesh and agreed to give him 1/5th share in future profit. Mahesh brings Rs.14000 as his share of goodwill. He agrees to contribute capital in the new profits sharing ratio. How much capital will be brought by Mahesh?
(a) 43750
(b) 45000
(c) 47250
(d) 48000

Answer: C

Question. A and B are partners in a firm having capital of Rs.54000 and Rs.36000 respectively. They admitted C for 1/3rd share in the profits. C brought proportionate amount of capital. The capital brought in by C would be
(a) 90000
(b) 45000
(c) 5400
(d) 36000

Answer: B

Question. A and B are partners sharing profits in the ratio of 7:3. A surrenders 1/7th of his share and B surrenders 1/3rd of his share in favour C the new partner. The sacrificing ratio will be:
(a) 3:7
(b) 1:1
(c) 7:3
(d) 3:2

Answer: B

Question. Which of the following is not true with respect to Admission of a partner?
(a) A new partner can be admitted if it is agreed in the partnership deed.
(b) If all the partners agree, a new partner can be admitted.
(c) A new partner has to bring relatively higher capital as compared to the existing partners
(d) A new partner gets right in the assets of the firm

Answer: C

Question. A and B are partners sharing profit and losses in ratio of 5:3. C is admitted for 1/4th share. On the date of reconstitution, the debtors stood at Rs 40,000, bill receivable stood at Rs. 10,000 and the provision for doubtful debts appeared at Rs. 4000. A bill receivable, of Rs 10,000 which was discounted from the bank, earlier has been reported to be dishonored. The firm has sold, the debtor so arising to a debt collection agency at a loss of 40%. If bad debts now have arisen for Rs 6,000 and firm decides to maintain provisions at same rate as before then amount of Provision to be debited to Revaluation Account would be:
(a) Rs 4,400
(b) Rs 4,000
(c) Rs 3,400
(d) None of the above

Answer: C

Question. When new partner does not bring his share of goodwill in cash, the amount is debited to:
(a) Current account of the new partner
(b) Premium account
(c) Capital account of the old partners
(d) Cash account

Answer: C

Question. Sacrificing ratio is calculated because:
(a) Profit shown by Revaluation Account can be credited to sacrificing partners
(b) Goodwill brought in by the incoming partner can be credited to the new partner
(c) Goodwill brought in by the incoming partner can be credited to the sacrificing partners
(d) Both a and c

Answer: C

Question. Sacrificing ratio is used to distribute ------------------ in case of admission of a partner.
(a) Goodwill
(b) Revaluation Profit or Loss
(c) Profit and Loss Account (Credit Balance)
(d) Both b and c

Answer: A

Question. The need of revaluation of assets and liabilities on admission:
(a) Assets and liabilities should appear at revised value
(b) Any profit and loss on account of change in values belong to old partners
(c) All unrecorded assets and liabilities get recorded
(d) None of the above

Answer: B

Question. A and B are partners sharing profits in the ratio of 3:1. C is admitted to partnership firm for 1/4th share. The sacrificing ratio of A and B will be:
(a) Equal
(b) 2:1
(c) 3:2
(d) 3:1

Answer: D

Question. Which statement is true with respect to AS-26?
(a) Purchased goodwill can be shown in the Balance Sheet
(b) Revalued goodwill can be shown in the Balance Sheet
(c) Both purchased goodwill and revalued can be shown in the Balance Sheet
(d) None of the above

Answer: A

Question. The share of new partner and the sacrificing ratio of old partners is decided by:
(a) the new partner only
(b) the old partners only
(c) the old partners and the new partner
(d) the accountant of the firm

Answer: C

Question. A and B are partners in a firm sharing profits in 4:1. They admit Pal as a new partner for ¼ share in the profits, which he acquired wholly from A. New profit sharing ratio of the partners is:
(a) 4:1:1
(b) Equally
(c) 11:4:5
(d) none of the above

Answer: C

Question. On admission of a partner, which of the following items of the balance sheet is transferred to the credit of capital accounts of old partners in the old profit sharing ratio, if capital accounts are maintained on fluctuating capital accounts method:
(a) Deferred revenue expenditure
(b) Profit and loss account (debit balance)
(c) Profit and loss account (credit balance)
(d) Balance in drawing account of partners

Answer: C

Question. At the time of Admission of a new partner, the Goodwill already appears in the Balance Sheet of the firm is treated as -
(a) Debited in all partners’ Capital Accounts in new ratio .
(b) Debited in old partners ‘ Capital Accounts in old ratio .
(c) Credited in old partners’ Capital Accounts in old ratio .
(d) None of the Above .

Answer : B

Question. X & Y are partners in a firm. Z is admitted for 1/5th Share . If there in no Partnership Deed,the ratio in which X & Y sacrifice their share of profit in favour of new partner is _
(a) In the Ratio of capital
(b) Equally
(c) Either a or b
(d) None of the Above

Answer : B

Question. Hema & Seema were Partner in a firm sharing profits in the ratio of 3:1.Their Capitals Were Rs.4,00,000 and Rs.1,00,000/- respectively.They Admitted Dimple on 1st April 2021 for 1/5th share in future profits.Dimple Brought Rs.2,00,000/-as her capital.The Dimple’s share of goodwill is
(a) Rs.50,000/-
(b) Rs.60,000/-
(c) Rs.1,00,000/-
(d) None of the Above

Answer : B

Question. On the Admission of New partner, Increase in a Liability of the firm will be shown in _
(a) Credit Side of profit & loss appropriation A/c
(b) Debit Side of Profit & Loss Appropriation A/c
(c) Credit side of revaluation A/c
(d) Debit side of Revaluation A/c

Answer : D

Question. Amit and Sumit are partners in a firm sharing profits and losses equally .A new partner Lalit is admitted for 20 % share and Goodwill of the firm is valued at Rs 60,000 . What is the entry for Goodwill ,if Lalit does not bring his share of goodwill in cash .
(a) Premium for Goodwill A/c …..Dr. 15,000 To Amit’s Capital A/c 7,500 To Sumit’s Capital A/c 7,500
(b) Lalit’s Current A/c …..Dr. 15,000 To Amit ‘s Capital A/c 7,500 To Sumit’s Capital A/c 7,500
(c) Premium for Goodwill A/c …..Dr. 12,,000 To Amit’s Capital Alc 6,000 To Sumit’s Capital A/c 6,000
(d) Lalit’s Current A/c …..Dr. 12,000 To Amit ‘s Capital 6,000 To Sumit‘s Capital 6,000

Answer : D

Question. Arti & Amit Were Partners in a firm Sharing Profits & losses in the ratio of 2:1.Vipul was admitted as a new partner for 1/5th Share in profits.Vipul acquired 2/3rd of his share from Arti.The Share, which Vipul Acquired from Amit is _
(a) 2/15
(b) 1/15
(c) 1/9
(d) None of the above

Answers : B

Question. Match the following 

(a) 1-iv , 2-ii , 3-i , 4-iii
(b) 1-ii , 2-iv , 3-i ,4-iii
(c) 1-ii , 2-i , 3-iii , 4-iv
(d) 1-ii , 2-iv , 3-iv , 4-iii

Answer : A

Question. Sun , Moon ,Star are partners in a partnership firm ,if Sky is admitted as a new partner -
(a) Old firm is dissolved .
(b) Old partnership and Old firm is dissolved .
(c) Old Partnership is reconstituted .
(d) None of these .

Answer : C

Question. In Case of Admission of a partner ,the entry for unrecorded Investment will be :-
(a) Debit Partners Capital A/c & Credit Investment A/c
(b) Debit Revaluation A/c & Credit Investment A/c
(c ) Debit Investment A/c & Credit Revaluation A/c
(d) None of the Above

Answer : C

Question. A, B ,C and D are Partners in a firm . A and B Share 2/3rd of profits Equally .C & D Share remaining Profits in the Ratio of 3:2.Find the profit sharing Ratio of A ,B ,C, and D.
(a) 7:7:6:4
(b)5:5:3:2
(c)3:3:3:2
(d) 3:3:6:4

Answer : B

Question. A and B are partners in a firm sharing profits and losses in the ratio of 3 : 2. They admitted C as a new partner . A sacrificed 1 / 5 th of his share and B sacrificed 1 / 5 th from his share in favour of C. C ‘s share in the profits of the firm will be -
(a) 5 / 25
(b) 8 / 25
(c) 6 / 25
(d) 2 / 5

Answer : B

Question. In Case of Fixed Capitals,Undistributed Losses are transferred to –
(a) Debit of Partners Capital A/c
(b) Credit of Partners Capital A/c
(c) Debit of Partners Current A/c
(d) Credit of Partners Current A/c

Answer : C

Assertion Reasoning Questions :

Question. Assertion : A minor can become a partner in a partnership firm .
Reason : The Indian Partnership Act ,1932 provides that minor can be admitted for the benefits in the partnership firm .
(a) Assertion and Reason both are correct and reason is the correct explanation of assertion .
(b) Assertion and Reason both are correct but reason is not the correct explanation of assertion .
(c) Assertion is true but reason is false .
(d) Assertion is false but Reason is true .

Answer : D 

Question. Assertion : The ratio in which old partners sacrifice their share in favour of new partner at the time of his/ her admission is known as Sacrificing Ratio . Reason : The Sacrificing ratio is calculated by taking out difference between new share and old share .
(a) Assertion and Reason both are correct and reason is the correct explanation of assertion .
(b) Assertion and Reason both are correct but reason is not the correct explanation of assertion .
(c) Assertion is true but reason is false .
(d) Assertion is false but Reason is true .

Answer : C

Question. Assertion : In case of Admission of a partner , change in profit sharing ratio etc.The Valued Goodwill is not shown in the books of account . Reason : As per AS -26 , Goodwill should be recognized in the books of account only when consideration in money or money’s worth is paid for it .
(a) Assertion and Reason both are correct and reason is the correct explanation of assertion .
(b) Assertion and Reason both are correct but reason is not the correct explanation of assertion .
(c) Assertion is true but reason is false .
(d) Assertion is false but Reason is true .

Answer : A

Question. Assertion : In case of Admission of Partner , Change in Profit sharing ratio etc. old agreement is cancelled and new agreement is prepared . Reason : Profit and Loss Adjustment A/c (Revaluation A/c ) is prepared to Revalue the assets and Reassessment of liabilities .
(a) Assertion and Reason both are correct and reason is the correct explanation of assertion .
(b) Assertion and Reason both are correct but reason is not the correct explanation of assertion .
(c) Assertion is true but reason is false .
(d) Assertion is false but Reason is true .

Answer : B

Question. Himanshu and Naman share profits & losses equally. Their capitals were Rs.1,20,000 and Rs. 80,000 respectively. There was also a balance of Rs. 60,000 in General reserve and revaluation gain amounted to Rs. 15,000. They admit friend Ashish with 1/5 share. Ashish brings Rs.90,000 as capital. Calculate the amount of goodwill of the firm. B
(a) Rs.1,00,000
(b) Rs. 85,000
(c) Rs.20,000
(d) None of the above

Answer: B

PRACTICAL PROBLEMS: 

1. A, B and C were partners in a firm sharing profits in 3:2:1. They admitted D for 10% profits. Calculate the new profit sharing ratio. ( Ans: 9:6:3:2).

2. X and Y are partners sharing profits in 5:3 ratio admitted Z for 1/10th share which he acquired equally for X and Y. Calculate new profit sharing ratio.(Ans. 23:13:4).

3. Radha and Rukmani are partners in a firm sharing profits in 3:2 ratio. They admitted Gopi as a new partner. Radha surrendered 1/3rd of her share in favour of Gopi and Rukmani surrendered 1/4th of her share in favour of Gopi. Calculate new profit sharing ratio.(Ans. 4:3:3)

4. A and B are partners in a firm sharing profits in the ratio of 3:2. They admit C into partnership for 1/5th share of profits in the firm. The goodwill of the firm is valued at Rs. 1,00,000. He is unable to bring in his share of goodwill. What will be the journal entries?

Solution: Goodwill of the firm = Rs 1,00,000

C’s share of goodwill = 1,00,000 X 1/5 = Rs. 20,000

Change in profit sharing ratio

1. What is meant by reconstitution of firm?

2. State the occasions on which reconstitution of partnership firm can take place.

3. What is meant by change in profit sharing ratio?

4. Define

(i) sacrificing ratio

(ii) gaining ratio

5. Enumerate the various matters that need adjustments at the time of change in profit sharing ratio.

6. Differentiate between sacrificing ratio and gaining ratio.

7. x, y and z are sharing P & L in the ratio of 5:3:2. They decide to share future profits and losses in the ratio of 2:3:5 with effect from 1st April 2002. They decide to record the effect of the following accumulated profits, losses and reserves without affecting their book figures, by passing a single adjusting entry.
                                                        Rs
General reserve                              24000
Profit & Loss a/c                              6000
Advertisement suspense A/c (Dr)   12000
                                                             [Ans z Dr 5400 to x 5400]
8. x, y and z are partners sharing P & L in ratio of 5: 3; 2, decide to share future P & L in the ratio of 2: 3: 5 with effect from 1st April 2002. an extract of their Balance Sheet as on 31-3-2002 is as
follows:
Liabilities                         Rs       Assets             Rs
Investment fluctuation
Reserve                         1500    Investment      20000
                                                  (at cost )
Show the accounting treatment in each of the following cases:
(a) If no other information is given.
(b) If market value of investment is Rs 20000.
(c) If market value of investment is Rs 19000.if market value of investment is Rs 18000.
(d) If market value of investment is Rs 20500.