Accountancy

Chapter 4: Admission of a Partner

MULTIPLE CHOICE QUESTIONS

Sl. Question:
No
01 A and B share profits and losses equally. They have ₹ 20,000each as capital. They
admit C as equal partner and goodwill was valued at ₹ 30,000. Cis to bring in
□ 30,000as his capital and necessary cash towards his share of goodwill. Goodwill
Account will not remain open in books. If profit on revaluation is ₹ 13,000,find the
closing balance of the capital accounts.
(A) ₹ 31,500;₹ 31,500; ₹ 30,000
(B) ₹ 31,500; ₹ 31,500; ₹ 20,000
(C) ₹ 26,500; ₹ 26,500; ₹ 30,000
(D) ₹ 20,000;₹ 20,000; ₹ 30,000

02 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.
03 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
04 A and B are partners of a partnership firm sharing profits in the ratio of 3 : 2
respectively. C was admitted for 1/5th share of profit. Machinery would be
appreciated by 10% (book value ₹ 80,000) and building wouldbe depreciated by
20% (₹ 2,00,000). Unrecorded debtorsof ₹ 1,250would be brought into books now
and a creditor amounting to ₹ 2,750 died and need not pay anything on this
account. What will be profit/loss on revaluation?
(A) Loss ₹ 28.000
(B) Loss ₹ 40,000
(C) Profits ₹ 28,000
(D) Profits ₹ 40,000
05 If at the time of admission if there is some unrecorded liability, it will be
to Account
A. Debited, Revaluation
B. Credited, Revaluation
C. Debited, Goodwill
D. Credited, Partners’ Capital

KVS ZIET BHUBANESWAER 12/10/2021 Page 1

 06 Revaluation Account or Profit and Loss Adjustment A/c is a
(A) Real Account
(B) Personal Account
(C) Nominal Account
(D) Asset Account

07 A and B are partners sharing profits in the ratio of 2 : 3. Their Balance Sheet
shows Machinery at ₹ 2,00,000;Stock at ₹ 80,000and Debtors at ₹ 1,60,000.C is
admitted and new profit sharing ratio is agreed at 6 : 9 : 5. Machinery is revalued
at ₹ 1,40,000 and a provision is madefor doubtful debts @5%. A’s share in loss
on
revaluation amount to ₹ 20,000. Revalued valueof Stock will be :
(A) ₹ 62,000
(B) ₹ 1,00,000
(C) ₹ 60,000
(D) ₹ 98,000

08 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

09 At the time of admission of a partner, what will be the effect of the following
information? Balance in Workmen compensation reserve ₹ 40,000. Claim for
workmen compensation ₹ 45,000.
(A) ₹ 45,000 Debited to the Partner’s capital Accounts.
(B) ₹ 40,000Debited to Revaluation Account.
(C) ₹ 5,000Debited to Revaluation Account.
(D) ₹ 5,000 Creditedto Revaluation Account.

10 Angle and Circle ware partners in a firm. Their Balance Sheet showed Furniture at
□ 2,00,000; Stockat ₹ 1,40,000; Debtors at ₹ 1,62,000 andCreditors at ₹ 60,000.
Square was admitted and new profit-sharing ratio was agreed at 2:3:5. Stock was
revalued at ₹ 1,00,000, Creditors of₹ 15,000are not likely to be claimed, Debtors
for ₹ 2,000have become irrecoverable and Provision for doubtful debts to be
provided @ 10%. Angle’s share in loss on revaluation amounted to ₹ 30,000.
Revalued value of Furniture will be:
(A) ₹ 2,17,000
(B) ₹ 1,03,000
(C) ₹ 3,03,000
(D) ₹ 1,83,000

KVS ZIET BHUBANESWAER 12/10/2021 Page 2

11. Why does incoming partner brings goodwill on his admission
a. To acquire right to share future profits.
b. To compensate old partners for their sacrifice.
c. To compensate old partners for their past efforts.
d. All of the above
12. On admission of a new partner, Work men compensation fund appearing in the
balance sheet is 15,000 and workmen claims a compensation of Rs 20,000. Pass
the journal entry for the treatment of workmen compensation fund.
a. Debit workmen compensation account Rs 5,000 and credit old partner’s
capital account Rs 5,000(old profit sharing ratio)
b. Debit workmen compensation account Rs 5,000 and credit Revaluation
account Rs 5,000
c. Debit Revaluation account Rs 5,000 and credit Workmen compensation
account Rs 5,000
d. None of these

The balance in the investment fluctuation fund after meeting the fall in the book
value of investment at the time of admission will be transferred to :
13.
a. Capital accounts of old partners
b. Revaluation account
c. General reserve
d. Capital accounts of all partners

Anand and Bobby are partners sharing profit in the ratio of 1:1. They admit Chiku
for 1/5th share who contributed Rs 25,000 for his share of goodwill. The total value
14. of the goodwill of the firm will be:
a. 25,000
b. 50,000
c. 1,00,000
d. 1,25,000
15.
Revaluation account is a :
a. Nominal account
b. Personal account
c. Real account
d. None of above.
16. A and B are partners sharing profits in the ratio 4:3. They admitted C as a new
partner who get 1/7th share of profit, entirely from A. The new profit sharing ratio
will be :
a. 3:3:1
b. 4:3:1
c. 3:3:2
d. 4:3:2

17. A and B are partners sharing profit or loss in the ratio 4:1. A surrendered 1/5 th
from his share and B surrendered 1/5th of his share in favour of new partner C.
What will be the C’s share?
a. 2/5
b. 6/25
c. 3/25
d. None of these

18. At the time of admission of partner profit or loss on revaluation of assets and
liabilities is share by the partners in
a. New profit sharing ratio
b. Old profit sharing ratio
c. Sacrificing ratio
d. None of these

19. According to AS 26, which goodwill is recorded in the books:

a. Purchased goodwill
b. Self generated goodwill
c. Both (a) and (b)
d. None of the above.
20. Section of the Indian Partnership Act provides that a new partner shall
not be inducted into a firm without the consent of all existing partners.
a. 31
b. 32
c. 33
d. 30

21 Sacrificing ratio is calculated because

(A) Profit shown in Revaluation A/c can be credited to sacrificing partner.
(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 partner (s)
(D) Both A and C
22 At the time of admission of partner, new profit sharing ratio is concerned with
partner(s),while sacrificing ratio is concerned with
partner(s).
(A) New,old
(B) New ,all
(C) Old, new
(D) All, old
23 Mohan and Sohan are partners sharing profits in the ratio 3:2. They admit Tarun
as a new partner. After his admission the profit sharing ratio becomes 5:5:3. On
the date of Tarun’s admission the goodwill of the firm is valued at ₹ 13,00,000.
The amount of goodwill to be brought in by Tarun will be
(A) ₹ 5,00,000
(B) ₹ 10,00,000
(C) ₹ 3,00,000
(D) ₹ 13,00,000
24 When the incoming partner acquires his share from existing partners in their profit
sharing ratio, the steps for calculation of new profit sharing ratio are given as
(i) Calculate old partners’ new share as part of combined share
(ii) Convert the new shares of all partners and find out the new profit
sharing ratio.
(iii) Calculate combined share of old partners in the new firm by deducting
new partners share from (i)
Arrange the steps in the correct order
(A)(i),(ii),(iii)
(B) (iii),(i),(ii)
(C) (ii),(iii),(i)
(D)(iii),(ii),(i)
25 Zakir and Yasin are partners with profit sharing ratio as 2:3.They admitted Qasim
who brought ₹ 80,000 as goodwill which was credited to Zakir and Yasin’s
capitalaccount as ₹ 60,000 and ₹ 20,000 respectively.Goodwill of the firm is ₹
4,00,000, calculate new profit sharing ratio
(A) 2:3:5
(B) 5:11:4
(C) 5:12:3
(D) Can’t be determined
26 When goodwill is paid privately by a new partner (at the time of admission),new
partners’ account is credited
(A) True
(B) Partially true
(C) False
(D) Can’t say
27 P and Q are in partnership sharing profits and losses in the ratio 3:2. They admit R
into partnership with 1/5th share which he acquires equally from P and
Q.Accountant has calculated the new profit sharing ratio as5:3:2. Is accountant
correct?
(A) True
(B) Partially true
(C) False
(D) Can’t say
28 A and B are partners in a firm . They admit C as a partner with 1/5 th share in
the profits of the firm. C brings ₹ 4,00,000 as his shareof capital. Calculate the
value of C’s share of goodwill on the basis of his capital, given that the combined
capital of A and B after all adjustments is ₹ 10,00,000
(A) ₹ 1,20,000
(B) ₹ 6,00,000
(C) ₹ 14,00,000
(D) ₹ 20,00,000

29 A and B are partners in the ratio of 3:1.C was admitted for 1/5 th share and he
could not bring his share of goodwill. Goodwill of the firm is valued at ₹
1,00,000.Journalise
(A) Premium for Goodwill A/c Dr 1,00,000
To A’s Capital A/c 75,000
To B’s Capital A/c 25,000
(B) C’s Capital A/c Dr 1,00,000
To A’s Capital A/c 75,000
To B’s Capital A/c 25,000
(C) C’s Capital A/c Dr 20,000
To A’s Capital A/c 10,000
To B’s Capital A/c 10,000
(D) C’s Capital A/c Dr 20,000
To A’s Capital A/c 15,000
To B’s Capital A/c 5,000

30 Match the columns for the situations at the time of admissions of new partner(s):
Column I Column II
i. Incoming partner a No Entry
brings his share of
goodwill
 ii. Incoming partner b Premium for Goodwill A/c Dr.
Incoming Partner’s Capital A/c Dr.
does not bring his
To Sacrificing Partners Capital A/c
share of goodwill
iii. Incoming partner c Premium for Goodwill A/c Dr.
To Sacrificing Partners Capital A/c
pays his share of
goodwill privately
iv. Incoming partner d Incoming Partner’s Capital A/c Dr.
To Sacrificing Partners Capital A/c
brings only a part of
his share of goodwill
(A) i- b, ii-c, iii-a, iv-d
(B) i- c, ii-d, iii-a, iv-b
(C) i- d, ii-c, iii-a, iv-b
(D) i- d, ii-c, iii-b, iv-a
31 Revaluation Account is a
(A) Real Account
(B) Nominal Account
(C) Personal Account
(D) Both A and B
32 In case of admission of a partner, the entry for unrecorded investments will be
(A) Debit Revaluation Account and Credit Investment Account
(B) Debit Partner’s Capital Account and Credit Investment Account
(C) Debit Investment Account and Credit Revaluation Account
(D) Debit Revaluation Account and Credit Partner/s Capital Account
33 How are Accumulated losses treated at the time of Admission of a partner?
(A) Debited to Partners Capital Account
(B) Credited to Partner’s Capital Account
(C) Credited to Revaluation Account
(D) Debited to Revaluation Account
34 Profit or loss on Revaluation of Assets and Liabilities is shared among:
(A) Old Partners In sacrificing Ratio
(B) Old partners in gaining Ratio
(C) Old Partners In old Ratio
(D) All partners In new Ratio
35 At the time of Admission of a partner, decrease in the value of a liability is
(A) Credited to Revaluation Account
(B) Debited to Revaluation Account
( C) Credited to Partner’s Capital Account
(C) Debited to Partner’s Capital Account
36 Why are assets and Liabilities revalued at the time of admission of a partner?
(A) To bring the value of assets and liabilities to their current value.
(B) So that the incoming partner is not put to an advantage or disadvantage
because of the change in values of assets and liabilities .
(C) Both A and B
(D) None of the above
37 Anamika and Sagarika were partner’s in a firm sharing profits and losses in the
ratio of 3:2. Bagmita was admitted with 1/6th share in the profits of the firm. At the
time of admission, workmen compensation Reserve appeared in the Balance Sheet
of the firm at Rs.32000. The claim on account of workmen compensation was
determined at Rs.40000. Excess of claim over the reserve will be
(A) Credited to Revaluation Account
(B) Debited to Revaluation Account
(C) Credited to Old Partner’s Capital Account
(D) Debited to All Partner’s Capital Account
38 A and B are partners sharing profits and losses in the ratio of 1:1. Their balance
sheet shows a machinery at Rs. 200000; stock at Rs. 80000 and Debtors at Rs.
100000. C is admitted and a new profit sharing Ratio is agreed at 5:3:2. Machinery
is revalued at Rs. 120000 and a provision is made for doubtful debts @10%. A’s
share in loss on revaluation amount to Rs.25000. Revalued value of stock will be:
(A) Rs.100000
(B) Rs.120000
(C) Rs.130000
(D) Rs.140000
39 L and M are partners sharing profits in ratio of 3 : 2 respectively. N was admitted
for 1/5th 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.1250 would be brought into books new and a creditor amounting to
Rs. 2750 died and need not pay anything on this account. What will be profit/loss
on revaluation?
(A) Loss Rs.28,000
(B) Profit Rs.28,000
(C) Loss Rs.40,000
(D) Profit Rs.40,000
40 Kushal and Kaushik are sharing profit and loss in the ratio of 2:1. Their balance in
the capital accounts is Rs.200000 and Rs.100000 respectively. They admit
Khonjon into the partnership for 1/4th share in the profit for which he brings
Rs.30000 as his share of Goodwill. The adjusted capital of Kushal and Khonjon
will be:
(A) Rs.20000 and Rs.10000 respectively.
 (B) Rs.220000 and Rs.110000 respectively.
(C) Rs.210000 and Rs.120000 respectively.
(D) Rs.10000 and Rs.20000 respectively.

41. Sun and Star were partners in a firm sharing profits in the ratio of 2:1. Moon was
admitted as a new partner in the firm. New profit-sharing ratio was 3:3:2. Moon
brought the following assets towards his share of goodwill and his capital:
Machinery Rs.2,00,000
Furniture 1,20,000
Stock 80,000
Cash 50,000
If his capital is considered as Rs.3,80,0000, the goodwill of the firm will be:
(A) Rs.70,000
(B) Rs.2,80,000
(C) Rs.4,50,000
(D) Rs.1,40,000
42. Goodwill existing in the books is written off at the time of admission of a partner,
it is transferred to partners’ capital accounts in their:
(A) Old profit-sharing ratio
(B) New profit-sharing ratio
(C) Sacrificing ratio
(D) Gaining Ratio
43. When the new partner brings cash for goodwill, the amount is credited to:
(A) Revaluation A/c
(B) Cash A/c
(C) Premium for goodwill A/c
(D) Realisation A/c

44. 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/c of the old partner
45. Sacrificing ratio is used to distribute......................in case of admission of a partner.
(A) Reserves
(B) Goodwill
(C) Revaluation profit
(D Balance in profit and loss A/c
46. X and Y are partners in a firm with capital of Rs.1,80,000 and Rs.2,00,000. Z was
admitted for 1/3rd share in profit and brings Rs.3,40,000 as capital. Calculate the
amount of goodwill.
(A) Rs.2,40,000
(B) Rs.1,00,000
(C)Rs.1,50,000
(D)Rs.3,00,000
47. A and B are partners sharing profits and losses in the ratio of 5:3.On admission, C
brings Rs.70,000 as cash and Rs.43,000 against goodwill. New profit ratio between
A,B and C is 7:5:4.The sacrificing ratio of A and C is :
(A) 3:1
(B) 1:3
(C) 4:5
(D) 5:9
48. 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
49. X and Y are partners sharing profits in the ratio of 3:1.They admit Z as a partner
who pays Rs.4,000 as goodwill, the new profit sharing ratio being 2:1:1 among
X,Y and Z.The amount of goodwill will be credited to:
(A) X and Y as Rs.3,000 and Rs.1,000
(B) Rs. 2,000
(C) Only Y
(D) Only X
50. A and B are partners sharing profits in the ratio of 2:3,they admit C as a partner for
1/4th share, the sacrificing ratio of A and B will be:
(A) 2:3
(B) 1:1
(C) 3:2
(D) 2:1

51 Unrecorded assets will be................................in Revaluation A/c?

(a). Credited
(b). debited
(c). Not shown
(d). Shown

52 Unrecorded liabilities will be................................in Revaluation A/c?

(a). Credited
(b). debited
(c). Not shown
(d). Shown
53 An increase in the value of assets will be recorded in...........................Side of
Revaluation a/c?
(a). Debit
(b). credit
(c). either debit or credit
(d). both debit and credit
54 A decrease in the value of assets will be recorded in...........................Side of
Revaluation a/c?
(a). Debit
(b). credit
(c). either debit or credit
(d). both debit and credit
55 A decrease in the value of liabilities will be recorded in...........................Side of
Revaluation a/c?
(a). Debit
(b). credit
(c). either debit or credit
(d). both debit and credit
56 An increase in the value of liabilities will be recorded in...........................Side of
Revaluation a/c?
(a). Debit
(b). credit
(c). either debit or credit
(d). both debit and credit
57 Revaluation Account or Profit & Loss Adjustment Account is a:
(a) Personal Account
(b) Real Account
(c) Nominal Account
(d) None of these
58 A and B are partners of a partnership firm sharing profits in the ratio of 3 : 2
respectively. C was admitted for 1/5th share of profit. Machinery would be
appreciated by 10% (book value ₹ 80,000) and building would be depreciated by
20% (₹ 2,00,000). Unrecorded debtors of ₹ 1,250 would be brought into books
now and a creditor amounting to ₹ 2,750 died and need not pay anything on this
account.What will be profit/loss on revaluation?
(A) Loss ₹ 28,000
(B) Loss ₹ 40,000
(C) Profits ₹ 28,000
(D) Profits ₹ 40,000
59 A and B are partners sharing profits in the ratio of 2 : 3. Their Balance Sheet shows
Machinery at ₹ 2,00,000; Stock at ₹ 80,000 and Debtors at ₹ 1,60,000. C is
admitted and new profit sharing ratio is agreed at 6 : 9 : 5. Machinery is revalued at
□ 1,40,000and a provision is made for doubtful debts @5%. A’s share in loss on
revaluation amount to ₹ 20,000. Revalued value of Stock will be :
(A) ₹ 62,000
(B)
□ 1,00,000(C)
□ 60,000
(D) ₹ 98,000
60 At the time of admission of a partner, what will be the effect of the
following information? Balance in Workmen compensation reserve ₹
40,000. Claim forworkmen compensation ₹ 45,000.
(A) ₹ 45,000 Debited to the Partner’s capitalAccounts.
(B) ₹ 40,000Debited to Revaluation Account.
(C) ₹ 5,000Debited to Revaluation Account.
(D) ₹ 5,000 Creditedto Revaluation Account.
(C) ₹ 5,000Debited to Revaluation Account.
61. The balance in the investment fluctuation reserve, after meeting the loss on
revaluation of investments, at the tine of admission of a partner will be transferred
to:
(a) Old partner’s capital A/c
(b) Revaluation A/c
(c) General reserve
(d) Capital reserve

62. When the balance sheet is prepared after the new partnership agreement, the assets
and liabilities are recorded at:
(a) Current cost
(b) Realising value
(c) Historical cost
(d) Revalued figures

63. If at the time of admission, there is some unrecorded liability, it will be:
(a) Credited to Partner’s Capital A/c
(b) Debited to Profit and Loss A/c
(c) Debited to revaluation A/c
(d) Credited to revaluation A/c
64. When the incoming partner brings in his share of premium for goodwill in cash, it is
adjusted by crediting to:
(a) Incoming partner’s capital A/c
(b) Premium for goodwill A/c
(c) Sacrificing partner’s capital A/c
(d) None of these
65. A and S are partners sharing profits in the ratio of 3:2. They admit B for 1/4 th share
who contributed Rs.30,000 for his share of goodwill. The total value of goodwill of
the firm will be:
(a) Rs.1,50,000
(b) Rs.1,20,000
(c) Rs.1,00,000
(d) Rs.1,60,000

66. R and S share profits in the ratio of 2:1. P is admitted with 1/4th share in profits. P
acquires 3/4th of his shares from R and 1/4th of his share from S. The new profit
sharing ratio will be:
(a) 2:1:1
(b) 3:1:1
(c) 23:13:12
(d) 13:23:12

67. Arun and Bhaskar are patners sharing profits and losses in the ratio of 3:2. Arun’s
capital is Rs.1,20,000 and Bhaskar’s capital is Rs.60,000. They admit Chandan for
1/5th share of profits. Chandan should bring as his capital:
(a) Rs.36,000
(b) Rs.48,000
(c) Rs.58,000
(d) Rs.45,000

68. W, X and Y are partners sharing profits in 3:2:1. They agreed to admit Z into the
firm. W, X and Y agreed to give 1/3rd, 1/6th, 1/9th share of their profit. The share
of profit of Z will be:
(a) 1/11
(b) 13/48
(c) 11/35
(d) 13/54
69. Ajay, Bhanu and Charu are partners sharing profits in the ratio of 4:3:2. Diya is
admitted for 2/9th share of profit. He brings Rs.30,000 as capital. New profit sharing
ratio is 3:2:2:2. Goodwill amount will be credited in the capital account of:
(a) Ajay only
(b) Ajay, Bhanu and Charu (equally)
(c) Ajay and Bhanu (equally)
(d) Ajay and Charu (equally)

70. A and B are partners sharing profits in the ratio of 3:2. On admission of C for 1/5th
share, Land is appreciated by 10% (Book value Rs.80,000), Building is decreased
by 20% (Rs.2,00,000), Unrecorded debtors of Rs.1,250 are bought in the books and
creditors of Rs.2,750 need not be paid. The profit/loss on revaluation will be:
(a) Loss Rs.28,000
(b) Loss Rs.40,000
(c) Profit Rs.28,000
(d) Profit Rs.40,000

71 A and B are partners sharing profit 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) 6 : 4 : 5

72 A and B are partners in a firm having capital balances of ₹ 54,000 and ₹

36,000respectively. They admit C in partnership for 1/3 rd share and C is to
bring
proportionate amount of capital. The capital amount of C would be :

a) ₹ 90,000
b) ₹ 45,000
c) ₹ 5,400
d) ₹ 36,000
73 A and B are in partnership sharing profits in the ratio of 3 : 2. They take C as a new
partner. Goodwill of the firm is valued at
□ 3,00,000 and C brings ₹ 30,000 as his share of goodwill in cash which is
entirelycredited to the Capital Account of A. New profit sharing ratio will be:
a) 3 : 2 : 1
b) 6 : 3 : 1
c) 5 : 4 : 1
d) 4 : 5 : 1

X and Y are partners sharing profit in the ratio of 3 : 2. Z was admitted with ¼
74
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

X and y are partners in a firm with capital of ₹ 1,80,000and

75
□ 2,00,000. Z wasadmitted for 1/3rd share in profits and brings
□ 3,40,000 as capital, calculate the amount ofgoodwill
:a) ₹ 2,40,000
b) ₹ 1,00,000
c) ₹ 1,50,000
d) ₹ 3,00,000
76 When new partner does not bring his share of goodwill in cash, goodwill is treated
by :
a) Credited the old partners in the sacrificing ratio and debiting the
new partner for his share of goodwill.
b) Crediting the old partners in old profit sharing ratio and debiting
the new partner for his share of goodwill.
c) Debiting the old partners in sacrificing ratio and crediting the
new partner for his share of goodwill
d) None of the above.
77 A and B share profits in the ratio of 3 : 2. They agreed to admit C on the condition
that A will sacrifice 3/25th of his share of profit in favour of C and B will sacrifice
1/25th 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

78 Vinay and Naman are partners sharing profit in the ratio of 4 : 1. Their capitals were
□ 90,000 and ₹ 70,000 respectively. They admitted Prateek for 1/3 share in the
profits. Prateek brought
□ 1,00,000 as his capital. What will be the value offirm’s goodwill?
a) ₹ 4000
b) ₹ 50000
c) ₹ 40000
d) ₹ 30000

79 Xero and Yasi were partners sharing profits in the ratio 3 : 2. They admitted Zero as
new partner for 1/5th share in the future profits of the firm which he got equally
from Xero and Yasi. What will be the new profit sharing ratio among Xero, Yasi
and Zero?
a) 3:5:1
b) 1:1:1
c) 3:5:2
d) 5:3:2

80 Hari and Leela are partners in a firm sharing profits and losses in the ratio of 2 : 3
Yash was admitted as a new partner for 1/5th share in the profit of the firm. Yash
acquires his share from Leela. The new profit sharing ratio of Hari, Leela and Yash
will be:
a) 2 : 3 : 5
b) 2 : 2 : 1
c) 5 : 3 : 2
d) 3 : 5 : 1
81 Ashok and Sudha were partners in a firm sharing profits and losses in the ratio of 3
: 1. They admitted Bani as a new partner. Ashok sacrificed 1/4th of his share and
Sudha sacrificed 1/4th of her share in favour of Bani. Bani’s share in the profits of
the firm will be :
a) 5 / 8
b) 1 / 8
c) 1 / 4
d) 7 / 16
82 Swati and Aman were partners in a firm. Their fixed capitals were
□ 9,00,000 and ₹ 3,00,000 respectively. They shared profits in the ratio of their
capitals. Divya was admitted as a new partner for 1/4th share in the profits of the
firm. Divya brought ₹ 60,000 as her share of goodwill premium and ₹ 6,00,000
asher capital. The amount of goodwill premium credited to Swati’s account will
be:a) ₹ 60,000
b) ₹ 30,000
c) ₹ 45,000
d) ₹ 15,000
83 If at the time of admission there is some unrecorded liability, it will be:
a) Debited to revaluation account
b) Credited to revaluation account
c) Debited to goodwill account
d) Credited to partner’s Capital accounts
84 When a new partner does not bring his share of goodwill in cash, the amount isdebited
to:
a) Cash A/c
b) Premium A/c
c) Current A/c of the new partner
d) Capital A/c of the old partner
85 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
s c) The sacrificing ratio
d) The gaining ratio
KEY/ANSWER SHEET
Multiple Choice question
01 A
02 B
03 C
04 A
05 A
06 C
07 D
08 C
09 C
10 D
11 D
12 C
13 A
14 D
15 A
16 A
17 B
18 B
19 A
20 A
21. (C) Goodwill brought in by the incoming partner can be credited to the
sacrificing partner (s)
22. (D) All, old
23. (C) ₹ 3,00,000
24. (B) (iii),(i),(ii)
25. (B) 5:11:4
26. (C) False
27. (A) True
28. (C) ₹ 14,00,000
29. (D)C’s Capital A/c Dr 20,000
To A’s Capital A/c 15,000
To B’s Capital A/c 5,000
30. (B)i- c, ii-d, iii-a, iv-b
31. A
32 C
 33 A C B C C B A
34 B
35
36
37
38
39
40

41 (B)

42 (A)

43 (C)

44 (C)

45 (B)

46 (D)

47 (A)

48 (A)

49 (D)

50 (D)

51 (a). Credited
52 (b). debited
53 (b). credit
54 (a). Debit
55 (b). credit
56 (a). Debit
57 (c) Nominal Account
58 (A) Loss ₹ 28,000
59 (D) ₹ 98,000
60 (C) ₹ 5,000Debited to Revaluation Account.

61 (a) Old partner’s capital A/c

62 (d) Revalued figures
63 (c) Debited to revaluation A/c
64 (c) Sacrificing partner’s capital A/c
 65 (b) Rs.1,20,000
66 (c) 23:13:12
67 (d) Rs.45,000
68 (d) 13/54
69 (b) Ajay, Bhanu and Charu (equally)
70 (a) Loss Rs.28,000
71 D

72 B

73 C

74 B

75 D

76 C

77 A

78 C

79 D

80 B

81 C

82 C

83 A

84 C

85 B

PREPARED BY PGTs ( COMMERCE) OF BHUBANESWAR, GUWAHATI, KOLKARA, RANCHI, SILCHAR AND

TINSUKIA REGIONS.