Accountancy Online Test Answer Key

LOYOLA ACADEMY CBSE SR. SEC.
SCHOOL
ACCOUNTANCY- ONLINE TEST
CLASS : XII C &E MARKS : 20
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1. Goodwill i s _ _ _ _ _
(a) tangible asset (b) intangible asset (c) fictitious asset (d) both (b) & (c)
2. Goodwill of the firm on the basis of 2 years' purchase of average profit of the last 3 years is Rs. 25,000. Find
average profit.
(a) Rs. 50,000 (b) Rs. 25,000 ( c ) Rs. 10,000 (d) Rs. 2500
3. Calculate the value of goodwill at 3 years' purchase when: Capital employed Rs. 2,50,000; Average profit
Rs. 30,000 and normal rate of return is I0%.
(a) Rs. 3000 (b) Rs. 25,000 (c) Rs. 30,000 (d) Rs. 5,000
4. What are super profits ?
a)Actual profit – Normal Profit b) Normal Profit - Actual profit
c) Actual profit + Normal Profit d)None of the above
5. The net assets of the firm including fictitious assets of 5,000 are 85,000.The net liabilities of the firm are
30,000.The normal rate of return is 10% and the average profits of the firm are 8,000.Calculate the goodwill as
per capitalization of super profits.
(a) Rs.20,000 (b) Rs. 30,000 (c) Rs. 25,000 (d) None of the above
6. Which of the following items are added to previous year’s profits for finding normal profits for valuation of
goodwill.?
a)Loss on sale of fixed assets b) Loss due to fire, earthquake etc
c) Undervaluation of closing stock d) All of the above
7. Following are the methods of calculating goodwill except:
a)Super profit method b) Average profit method
c) Weighted Average profit method d) Capital profit method

8. The excess amount which the firm can get on selling its assets over and above the saleable value of its assets
is called :
a)Surplus b) Super profits c) Reserve d) Goodwill
9. Capital invested in a firm is 5,00,000.Normal rate of return is 10% .Average profit of the firm are
64,000(after an abnormal loss of 4,000).Value of goodwill at four times the super profits will be:
(a) Rs.72,000 (b) Rs. 40,000 (c) Rs. 2,40,000 (d) 1,80,000
10. Weighted average profit method of calculating goodwill is used when:
(a) Profits are not equal (b) Profits show a trend
(c) Profits are fluctuating (d)None of the above
11. Any change in the relationship of existing partners which results in an end of the existing agreement
and enforces making of new· agreement is called:
(a) Revaluation of partnership (b) Reconstitution of partnership
(c) Realisation of partnership (d)None of the above
12. The ratio in which a partner receives a rise in his share of profits is known as:
(a) New Ratio (b) Sacrificing Ratio (c) Capital Ratio (d) Gaining Ratio
13. Reserves and accumulated profits are transferred to partners ' capital accounts at the time of
reconstitution in:
(a) Old profit-sharing ratio (b) Sacrificing Ratio
(c) Gaining ratio (d) New profit-sharing ratio
14. A and B are partners in a firm sharing profits in the ratio of 3 : 2. They decided to share future
profits equally. Calculate A’s gain or sacrifice
(a) 2/10 (sacrifice) (b) 5/10 (gain) (c) 1/10 (Gain) (d) 1/10 (sacrifice)
15. .A,B and C were are partners in a firm sharing profits in the ratio of 3:4:1 .They decided to share profits equally
w.e.f from 1 .4.2019. On that date the profit and loss account showed the credit balance of 96,000.instead
of closing the profit and loss account ,it was decided to record an adjustment entry reflecting the change in
profit sharing ratio .In the journal entry:
a) Dr. A by 4,000; Dr. B by 16,000; Cr C by 20,000
b) Cr. A by 4,000; Cr. B by 16,000; Dr C by 20,000
c) Cr. A by 16,000; Cr. B by 4,000; Dr C by 20,000
d) Dr. A by 16,000; Dr. B by 4,000; Cr C by 20,000
16. X,Y and Z are partners sharing profits and losses in the ratio of 5:3:2.They decide to share the future profits in
the ratio of 3:2:1. Workmen compensation reserve appearing in the balance sheet on the date if no
information is available for the same will be:
a) Distributed among the partners in old profit sharing ratio
b) Distributed among the partners in new profit sharing ratio
c) Distributed among the partners in capital ratio
d)Carried forward to new balance sheet without any adjustment
17. U V and W are partners sharing profits in the ration of 2:3:5. They also decide to record the effect of the
following revaluations and reassessments without affecting the book values of assets and liabilities
by passing a single adjustment entry:
Book Value (Rs) Revised Value (Rs)

Land and Building 3,00,000 3,50,000
Furniture 1,50,000 1,00,000
Sundry Creditors 60,000 20,000
Outstanding Salaries 10,000 15,000
The single adjustment entry will
(a) Dr. W and Cr. U by 10,500
(b) Dr. U and Cr. W by Rs. 10 ,500
(c) Dr. V and Cr. U by Rs. 10,500
(d) Dr. W and Cr. V by Rs. 10,500

18. In case of change in profit-sharing ratio, the gaining partner must compensate the sacrificing
partners by paying the proportional amount of
(a) capital ( b) cash (c) goodwill (d) none of the above
19. Sacrificing ratio is the difference between :
(a) Old ratio and new ratio (b) New ratio and old ratio
(c) New ratio and gaining ratio (d) Old ratio and gaining ratio
20. Increase and decrease in the value of assets and liabilities are recorded through:
(a) Partners' Capital Account
(b) Profit and Loss Appropriation
(c) Revaluation Account
(d) Balance Sheet
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LOYOLA ACADEMY CBSE SR. SEC.

ACCOUNTANCY- ONLINE TEST

CLASS : XII C &E MARKS : 20

4. What are super profits ?

a)Actual profit – Normal Profit b) Normal Profit - Actual profit

c) Actual profit + Normal Profit d)None of the above

a)Loss on sale of fixed assets b) Loss due to fire, earthquake etc

c) Undervaluation of closing stock d) All of the above

7. Following are the methods of calculating goodwill except:

a)Super profit method b) Average profit method

c) Weighted Average profit method d) Capital profit method

a)Surplus b) Super profits c) Reserve d) Goodwill

10. Weighted average profit method of calculating goodwill is used when:

(a) Profits are not equal (b) Profits show a trend

(c) Profits are fluctuating (d)None of the above

(a) Revaluation of partnership (b) Reconstitution of partnership

(c) Realisation of partnership (d)None of the above

(a) Old profit-sharing ratio (b) Sacrificing Ratio

(c) Gaining ratio (d) New profit-sharing ratio

b) Cr. A by 4,000; Cr. B by 16,000; Dr C by 20,000

c) Cr. A by 16,000; Cr. B by 4,000; Dr C by 20,000

d) Dr. A by 16,000; Dr. B by 4,000; Cr C by 20,000

a) Distributed among the partners in old profit sharing ratio

b) Distributed among the partners in new profit sharing ratio

c) Distributed among the partners in capital ratio

d)Carried forward to new balance sheet without any adjustment

Book Value (Rs) Revised Value (Rs)

The single adjustment entry will

(a) Dr. W and Cr. U by 10,500

(b) Dr. U and Cr. W by Rs. 10 ,500

(c) Dr. V and Cr. U by Rs. 10,500

(d) Dr. W and Cr. V by Rs. 10,500

(a) capital ( b) cash (c) goodwill (d) none of the above

19. Sacrificing ratio is the difference between :

(a) Partners' Capital Account

(b) Profit and Loss Appropriation

(c) Revaluation Account

(d) Balance Sheet

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