NCERT MCQ ON Reconstitution of a Partnership Firm — Admission of a Partner :
Question1: 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
Question2: 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
Question3: Excess of the credit side over the debit side of revaluation account
- a) Profit
- b) Loss
- c) Gain
- d) Expense
Answer: Profit
Question4: 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
Question5: Share of goodwill brought in by new partner in cash is called
- a) Premium
- b) Profit
- c) Assets
- d) Liabilities
Answer: Premium
Question6: 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:7 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
Question8: 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
Question9: 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
Question10: 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
Question11: 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
Question12: 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
Question13: 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
Question14: 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.
Question15: 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
Question16: 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
Question17: 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
Question18: 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
Question19: 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
Question20: 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
Question21: 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
Question22: 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
Question23: 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
Question24: 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
Question25: 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
Question26: 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
Question27: 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
Question28: 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
Question29: 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
Question30: 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
Question31: 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
Question32: 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
Question33: 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
Question34: 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
Question35: 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
Question36: 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
Question37: 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
Question38: 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
Questio39: 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
Question40: 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
Question41: 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
Question42: 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
Question43: 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
Question44: 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
Question45: 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
Question46: 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
Question46: 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
Question47: 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
Question48: 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
Question49: 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
Question50: 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
Question51: 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
Question52: 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
Question53: 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
Question54: 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
Question55: 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
Question56: 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
Question57: 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
Question58: 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
Question59: 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
Question60: 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
Question61: 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
Question62: 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
Discover more from EduGrown School
Subscribe to get the latest posts sent to your email.