CBSE Questions for Class 12 Commerce Accountancy Reconstitution Of A Partnership Firm - Retirement / Death Of A Partner Quiz 1 - MCQExams.com

Sales for the year ended amounted to Rs. 10,00,Sales included goods sold to Mr.A for Rs. 50,000 at a profit of 20% on cost.Such goods are still lying in the godown at the buyer's risk. Such goods should be treated as part of :
  • Sales
  • Closing stock
  • Goods in transit
  • Sales return
A, B, C were partners sharing profits in the proportion of 1/2, 1/3 and 1/6 respectively. On 31st March 1997 their capital stood as follows:
    A Rs. 4,00,000, B Rs. 3,00,000, C Rs. 2,50,000.
A sum of 1,20,000, also appeared as reserve fund in their balance sheet on this date. B retire on this date when the goodwill of firm was valued at Rs. 1,80,000.
Profit and loss adjustment account prepared on that date without taking goodwill and reserve fund into consideration showed a net profit of Rs. 28,500.
The net amount payable to B will be :
  • Rs. 3,82,500
  • Rs. 4,09,500
  • Rs. 3,63,800
  • Rs. 4,04,000
Which of the following formula is used to calculate goodwill under super profit method?
  • Goodwill = Weighted average profit x No. of year purchase.
  • Goodwill = Average profit x No. of year purchase.
  • Goodwill = Super profit x No. of year purchases.
  • Any of the above.
The capital of A and B sharing profits and losses equally are Rs.90,000 and Rs.30,000 respectively.They value the goodwill of the firm at Rs.80,000, which was not recorded in the books.If goodwill is to be raised now, by what amount each partner's capital amount will be debited?
  • Rs. 20,000 and Rs.60,000
  • Rs. 40,000 and Rs.40,000
  • Rs. 60,000 and Rs.20,000
  • None of these
The profits for 1998-99 are Rs.2,000; for 1999-2000 Rs.26,100 and for 2000-01 Rs.31,Closing stock for 1999-2000 and 2000-01 includes the defective items of Rs. 2,200 and Rs. 6,200 respectively which were considered as having market value NIL.Calculate the goodwill on two years' purchase of average profit.
  • Rs.47,400
  • Rs.35,400
  • Rs.27,400
  • Rs.34,600
Which of the following formula is used to calculate goodwill under weighted average profit method ?
  • Goodwill = Weighted average profit x no. of year purchase.
  • Goodwill = Average profit x no. of year purchase.
  • Goodwill = Super profit x no. of year purchase.
  • Goodwill = Super profit x Annuity factor.
In which of the following cases, the need for the valuation of goodwill in a firm may arise?
  • Admission of new partner.
  • While changing profit sharing ratio.
  • Retirement or death of a partner.
  • All of above.
If vendors are issued fully paid shares of $$Rs. 80,000$$ in the consideration of net assets of $$Rs. 60,000$$, then the balance of $$Rs. 20,000$$ will be _____________________.
  • Debited to profit and loss account
  • Debited to goodwill account
  • Credited to capital reserve account
  • Credited of share premium account
Which of the following formula is used to calculate goodwill under simple average profit method?
  • Goodwill = Weighted average profit x No. of year purchase.
  • Goodwill = Average profit x No. of year purchase.
  • Goodwill = Super profit x No. of year purchases.
  • Goodwill = Super profit x Annuity factor.
If the incoming partner is to bring in premium for goodwill in cash and also balance exist, in the goodwill Account, then this Goodwill Account is written off among the old partners in _________ .
  • the new profit-sharing ratio
  • the old profit-sharing ratio
  • the sacrifice ratio
  • none of the above
$$Z$$ is admitted to a firm for $$1/4^{th}$$ share in the profit, for which he brings in Rs.$$10,000$$ towards premium for goodwill. It will be taken by the old partners in ____________ .
  • The old profit-sharing ratio
  • The new profit-sharing ratio
  • The sacrificing ratio
  • None of the above
X,Y and Z are partner sharing profits in the ratio of $$5:3:2$$. If $$Y$$ retires then the new ratio will be______.
  • $$5:2$$
  • $$5:3$$
  • $$3:2$$
  • $$2:5$$
'Samta Limited invited applications for issuing $$6,750$$ equity shares of $$Rs 10$$ each. The amount was payable as follows :  On application - $$Rs 3$$ per share 
On allotment - $$Rs 5$$ per share
On first and final call - $$Rs 2$$ per share 
The issue was fully subscribed. Subhash applied for $$250$$ shares and paid his entire share money with application. Moti applied for $$175$$ shares and paid allotment money also with application. The amount received with applications was :
  • $$Rs 16,750 $$
  • $$Rs 16,000$$
  • $$Rs 19,250$$
  • $$Rs 22,875$$
Factor(s) affecting the value of goodwill is/are _____________.
  • Quality
  • Location or site
  • Competition
  • All the above
The formula of average profit method is __________.
  • $$\dfrac {Total\ Profits}{No. of \ years}$$
  • Super Profit $$-$$ Normal Profit
  • Super Profit $$\times$$ No. of years
  • $$\dfrac {Super\ profit}{Normal\ profit}$$
'Dogs' is applicable in case of professional services like ______________.
  • Lawyers
  • Doctors
  • Traders
  • Both (A) and (B)
Which method is useful when the actual profit is less than normal profit?
  • Super profit method
  • Capitalisation method
  • Average profit method
  • Premium method
The formula of super profit is ____________.
  • $$\dfrac {Total\ profits}{No. of\ years}$$
  • Capital employed $$\times$$ normal rate of return
  • Average profit $$-$$ normal Profit
  • Super profit $$\times$$ no. of years of purchase
_________ is calculated when a partner retires from the firm.
  • Sacrificing ratio
  • Gaining ratio
  • Profit sharing ratio
  • Either (A) or (C)
Which of the following are true or false?
a) A retiring partner will be held liable for the debts incurred by the firm after his retirement.
b) He must give public notice to that effect
  • Both (A) and (B) are true
  • Both (A) and (B) are false
  • (A) is true, but (B) is false
  • (A) is false, but (B) is true
Goodwill means ___________.
  • the attractive force which brings in customers
  • attachment of customer to a particular business
  • reputation of the firm
  • all of the above
Liquidation expenses paid by the transferee company is debited to _________.
  • General reserve account
  • P/L account
  • Goodwill account
  • None of these
The excess of purchase consideration over net assets of the transferor company acquired by the transferee company should be recognized as ________ in purchase method.
  • capital reserve
  • general reserve
  • goodwill
  • P&L
________  may be defined as the value of the reputation of the firm.
  • Capital
  • Goodwill
  • Drawings
  • Assets
During the reconstitution of partnership firm, _________ is valued.
  • Expenses
  • Incomes
  • Assets
  • Goodwill
_______ is an intangible asset which arises on acquisition or is internally generated.
  • Copyrights
  • Goodwill
  • Trademarks
  • Patent
Under which of the following methods of capitalization Goodwill = Capitalised Value of Firm(avg profit) - NET Assets(capital employed).
  • Capitalisation of Super Profits Method
  • Capitalisation of NRR
  • Capitalisation of normal Profits Method
  • Capitalisation of Average Profits Method
Under ___________ method Goodwill is valued at the agreed number of years purchase of the average profits of the past few years.
  • Average Profit Method
  • Super Profit Method
  • Capitalization Method
  • None of Above
If, average profit during last few years is $$Rs.100000$$, NRR is $$10$$%. Ascertain the value of goodwill by capitalisation of average profit method if total assets are $$Rs.1500000$$ and liabilities $$Rs.680000$$.
  • $$Rs.1,00,000$$
  • $$Rs.1,80,000$$
  • $$Rs.1,10,000$$
  • $$Rs.1,05,000$$
Goodwill is a _______ asset but not fictitious asset.
  • Tangible
  • Intangible
  • Personal
  • Nominal
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