CBSE Questions for Class 12 Commerce Accountancy Reconstitution Of A Partnership Firm - Retirement / Death Of A Partner Quiz 13 - MCQExams.com

Excess of actual profit over normal profit is called
  • Normal profit
  • Super profit
  • Capitalized profit
  • All of the above
A,B and C are three partners sharing profit and loss in the ratio of 3:2:B retire from the firm.If B's share of profit is purchased by C. What will be new profit sharing ratio? 
  • 1:2
  • 2:1
  • 3:1
  • 3:2
There are three partners P,Q and R sharing profit and loss in the ratio of 4:5:Q retires, and the remaining partners agreed to share profit and loss in future in the ratio of 7:What is the gaining ratio of the old partners?
  • 8:3
  • 5:4
  • 7:8
  • 3:5
X,Y and Z are three partners in a firm.They are sharing profit and loss in the ratio of 3:2:1.On 11th Jan Y died. The firm decided to value goodwill based on 3 years purchase of weighted  average of 5 years profit.The trading profit of the firm for the past five years before charging interest on capital was as under Rs.10,000,Rs.9,000,Rs.11,000,Rs.7,000,Rs.8,The capital of the firm stood Rs.50,000 and interest on capital of the firm stood Rs.50,000 and interest on capital is given at 8%. What is Y's share of goodwill?
  • Rs.15,000
  • Rs.9,000
  • Rs.10,000
  • Rs.7,500
The amount due to the deceased partner is paid to his __________.
  • friends
  • wife
  • executor
  • father
On retirement /death of a partner new Profit sharing ratio of remaining partner _________.
  • old ratio + gaining ratio.
  • old ration+ sacrificing ratio.
  • 1/No. of partners.
  • old ratio - sacrificing ratio.
At the time of admission when goodwill account is not being opened in the books of account, credit is given to the old partner in what ratio? 
  • Old profit sharing ratio
  • New profit sharing ratio
  • Sacrificing ratio
  • Equally
The reputation of a business expressed in terms of money.
  • Capital
  • Income
  • Goodwill
  • Copy rights
Amount due to a retiring partner is shown as _________.
  • capital a/c.
  • long term loan.
  • retiring partner loan a/c.
  • term loan a/c.
A,B and C are sharing profit and loss  in the ratio of 4:3:2,B retires and remaining partner agree to share profit in the ratio of 5:3 and decides not to raise goodwill a/c. Goodwill of the firm is valued at Rs.72,What would be the adjustment entry________. 
  • A' A/c Dr Rs.24,000,B's A/c Dr 24,000,C's A/c Credit by Rs.48,000.
  • A's A/c Dr 13,000,C's A/c Dr 11,000,B's A/c credit Rs.24000
  • A's A/c Rs 11,000,C's A/c Dr 13,000, B's A/c Cr. Rs.24,000
  • Goodwill a/c 72,000 Dr, A's Capital, B's capital and C's Capital credit Rs.24,000 each
A, B and C are three partners. On death of B assets and liabilities are revalued as under, Provision for doubtful debts reduced by Rs.1050, Stock in trade decreased by Rs.550, unrecorded liability Rs.1500 taken on record Building increased by Rs.Remaining partners decides to reinstate the assets and liabilities at old balances. The revaluations would be given effects by _________. 
  • A a/c Dr. 250,C A/c Dr Rs.250,Credit B Rs.500
  • A a/c Dr. 250,C A/c cr Rs.250,Debit B Rs.500
  • A a/c Dr. 500,C A/c Dr Rs.500,Credit B Rs.500
  • A a/c Dr. 250,B A/c Dr Rs.250,Credit C Rs.500
Consequent upon admission of a new partner in a firm the value of the goodwill is valued at Rs.60,But there exists a goodwill account in the balance sheet which stood at Rs.48,000 what would be treatment of goodwill at the time of admission of a new partner if the firm follows revaluation method of goodwill?
  • Debit goodwill A/c by Rs.12,000
  • Debit goodwill A/c by Rs.48,000
  • Debit goodwill A/c by Rs.60,000
  • Credit goodwill A/c by Rs.12,000
PQR are three partners in a firm, they decided to admit S a fourth partner in the firm with 1/4th share of profit and loss in the firm. Firm decides to revalue the goodwill of the firm on the basis of 3 years purchase of past 4 years average profits. What would be the value of the goodwill of the firm if the firm decides to revalue the goodwill based on 5 years super profit and an average profit of the industry during the year is 14,000 p.a? Actual past profit of the firm are as follows:
               2010                              Rs. 22,000
               2011                              Rs. 17,000
               2012                              Rs. 22,000
               2013                              Rs. 19,000
  • Rs, 30,000
  • Rs, 35,000
  • Rs. 25,000
  • Rs. 28,000
Which of these statements is true?
  • Joint life policy is taken by the partners in order to provide funds at the time of retirement / death of any partner.
  • Joint life policy reserve account is created to bring down the policy account to surrender value.
  • Indian Partnership Act prohibits payment of any share of profit to a retiring partner if account are not settled.
  • The retiring partner pays for his share of goodwill to the remaining partner.
X & Associates is a partnership firm, it intends to revalue its goodwill, average profit for the past five years is Rs. 11,000 per annum and goodwill is being valued 3 years purchase of average profit. What would be the value of the goodwill of the firm?
  • Rs.33,000
  • Rs.11,000
  • Rs.35,000
  • Rs.25,000
A,B and C are three partner sharing profit and loss equally. C dies on 30th June 2010.If the total profit for the year ending 31st March 2011 amounted to Rs.30,000.What would be the share of profit to be credited to C's A/c?
  • 10,000
  • 5,000
  • 8,000
  • 2,500
As per provisions of the Partnership Act, executor is entitled to interest at ____% on the final amount due to the deceased partner.
  • 4
  • 6
  • 8
  • 7.5
ABC Associates has decided to value the goodwill of the firm using capitalisation method. Find the goodwill of the firm if capital employed of the firm is $$Rs.24,00,000$$. Reasonable return on capital is $$12.5$$% and current years profit is $$Rs.8,00,000$$.
  • $$Rs.64,00,000$$
  • $$Rs.40,00,000$$
  • $$Rs.24,00,000$$
  • $$Rs.56,00,000$$
Mr.X is admitted into a partnership firm for 1/4th share of profit. The total capital of the old partners stood at Rs. 45,000 after carrying adjustment of goodwill, revaluation of assets and liabilities and transfer of reserves and surplus. If X pays Rs.15,000 as his share of goodwill to the existing partner privately, what would be accounting treatment? 
  • Goodwill A/c to be debited by Rs. 15,000
  • Goodwill A/c to be debited by Rs. 60,000
  • No accounting treatment
  • Credit to goodwill A/c by Rs. 15,000
ABC are three partners in a firm, they decided to admit D a fourth partner in the firm with 1/4th share of profit and loss in the firm. Firm decides to revalue the goodwill by capitalizing super profit @10%. What is the goodwill of the firm average profit and normal profit were Rs. 20,000 and 13,000 respectively?
  • Rs. 70,000
  • Rs, 75,000
  • Rs. 7,000
  • Rs. 13,000
When the Joint Life Insurance Policy premium is treated as expenses,the amount reserved on death of the partner is transferred to _________. 
  • partners capital A/c.
  • cash A/c.
  • profit and loss appropriation A/c.
  • general reserve A/c.
A and B, who are partners, share profits in the ratio of 7:C is admitted as a new partner. A surrenders 1/7 of his share and B surrenders 1/3 of his share in favour of C. The new profit sharing ratio will be _______.
  • $$6:2:2$$
  • $$4:1:1$$
  • $$3:2:2$$
  • None of these
Increase in liability at the time of retirement of partner is _______.
  • debited to goodwill account
  • debited to profit & loss account
  • debited to revaluation account
  • credited to revaluation account
P, Q and R as are in partnership, Q dies on $$15th$$ June, which of the following statement is true?
  • Q's estate is not liable at all.
  • Q's estate is not liable for any acts of the firm done after $$15th$$ June.
  • Q's estate is liable for all acts up to the end of the financial year when the death occurred.
  • Q's estate is liable only up to the previous financial year.
A and B are two partners sharing profit and loss equally. Their capital A/c stood at Rs.30,000 and Rs.25,000 respectively on 31st March,On 1st April C is admitted for 1/3rd share of profit for which he brings Rs.12,000 as his share of goodwill. On the date of his admission, stock was appreciated by Rs.11,000 and provisions for bad debts also increased by Rs.2,Old partners decided that C's capital should be in accordance with his share of profit and capital of old partners. What amount C should brings as his share of capital in the firm?
  • Rs.40,000
  • Rs.38,000
  • Rs.36,000
  • Rs.41,000
On the death of a partner, his executor is paid the share of profits of the died partner for the relevant period. This payment is recorded in Profit & Loss _______ A/c
  • Adjustment
  • Appropriation
  • Suspense
  • Reserve
In which of the following events public notice is not required?
  • Death of a partner.
  • Insolvency of a partner.
  • Retirement of a sleeping partner.
  • All the the above.
A and B are two partners sharing profit and loss equally. Their capital A/c stood at Rs.30,000 and Rs.25,000 respectively on 31st March,On 1st April C is admitted for 1/3rd share of profit for which he brings Rs.12,000 as his share of goodwill. On the date of his admission, stock was appreciated by Rs.11,000 and provisions for bad debts also increased by Rs.2,Old partners decided that C's capital should be in accordance with his share of profit and capital of old partners. What amount be the total capital of the firm after admission of C?
  • Rs.1,14,000
  • Rs.1,08,00
  • Rs.1,21,000
  • Rs.99,000
X and Y are two partners in  firm having share capital of Rs.10,000 and Rs.15,000 respectively. Z is admitted for 1/3 share of profit for which he is to bring Rs.15,000 for his share of capital. What is the goodwill of the firm?
  • $$Rs.10,000$$
  • $$Rs.9,000$$
  • $$Rs.5,000$$
  • $$Rs.11,000$$
Decrease in liability at the time of retirement of partner is ________.
  • debited to Goodwill A/c
  • debited to Profit & Loss A/c
  • debited to Revaluation A/c
  • credited to Revaluation A/c
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