ISC Board Questions/ Sample paper Questions

ADMISSION OF A PARTNER

SHORT ANSWER

1. ISC 2022- Sem 1

B
2. ISC 2022- Sem 1
C
3. ISC 2022- Sem 1
B
4. ISC 2022- Sem 1
5. SP 2022 – Sem 1
Veena and Soma are partners in a firm. They admit Sara on 1st April, 2020, for 1 4 ⁄ share in the
profits of the firm. Sara acquired her share as 1 12 ⁄ from Veena and the remaining from Soma.
The sacrificing ratio of the old partners will be:
(a) 11:12
(b) 1:1
(c) 1:2
(d) 1:11
C
6. SP 2022- Sem 1
Runa and Ria were partners in a firm sharing profits and losses in the ratio of 3:1. On 1 st April,
2020, Uday is admitted as a new partner in the firm for 3/8th share in the profits on various
terms, one of them being his contribution of ₹ 42,000 as capital.
The new profit-sharing ratio amongst all the partners to be 3:2:3. The capitals of Runa and Ria,
after taking into account all the terms of admission were ₹ 61,625 and ₹ 25,375. It is decided
that the Capital Accounts of Runa and Ria be adjusted in the ratio of their respective share in the
profits after admission, any surplus to be adjusted through the Current Account while any
deficiency through the Cash Account. The surplus capital adjusted through current account will
be:
(a) Ria’s debit capital balance of ₹ 2,625
(b) Runa’s credit capital balance of ₹ 2,625
(c) Runa’s debit capital balance of ₹ 19,625
(d) Runa’s credit capital balance of ₹ 19,625
C
7. SP 2022- Sem 1
Dhruv and Ansh are partners in a firm sharing profits and losses: Dhruv 75% and Ansh 25%.
Their Balance Sheet as at 31st March, 2021 is given below:
Balance Sheet of Dhruv and Ansh As at 31st March, 2021

On 1st April 2021, Kavi is admitted as a new partner on the following terms:
(i) Land and building is found to be valued at 25% above cost. It is decided to bring it to its cost.
(ii) Bad debts amounting to ₹ 1,800 are to be written off. The remaining debtors are good.
(iii) Creditors include an amount of ₹ 5,000 received as commission from Amar. The necessary
adjustment is required to be made.
(iv) The liability on Workmen Compensation Reserve is determined at ₹ 3,000.
(v) Kavi is to pay ₹ 15,000 to the existing partners as premium for Goodwill for 20% of the
future profits of the firm. He is also to bring in ₹ 25,000 as capital.
(a) At the time of Kavi’s admission, the Workmen Compensation Reserve of:
(i) ₹ 5,000 will be credited to the capital accounts of all the partners
(ii) ₹ 3,000 will be credited to the capital accounts of all the partners.
(iii) ₹ 2,000 will be credited to the capital accounts of the old partners.
(iv) ₹ 2,000 will be debited to the capital accounts of the old partners.
iii
(b) The value of Land & Building in the Balance Sheet of the reconstituted firm will be:
(i) ₹ 20,000
(ii) ₹ 31,250
(iii) ₹ 5,000
(iv) ₹ 6,250
i
(c) To adjust the creditors in adjustment (iii):
(i) Commission A/c will be credited with ₹ 5,000.
(ii) Creditors A/c will be credited with ₹ 5,000.
(iii) Amar’s A/c will be debited with ₹ 5,000.
(iv) Creditors A/c will be debited with ₹ 5,000.
iv
(d) The provision for doubtful debts in the reconstituted firm will be:
(i) ₹1,500
(ii) ₹1,800
(iii) Nil
(iv) None of the above
iii
(e) The date of the Balance Sheet of the reconstituted firm will be:
(i) Balance Sheet for the year ending 31st March, 2022.
(ii) Balance Sheet as at 31st March, 2021.
(iii) Balance Sheet for the year ending 1st April, 2021.
(iv) Balance Sheet as at 1st April, 2021.

8. SP 2023
Joy and Deb were partners sharing profits & losses in the ratio of 2:1. They admitted Gopi into
partnership for 1 5 ⁄ share. At the time of Gopi’s admission, Furniture (book value ₹ 2,50,000)
was reduced by 40% and Machinery (book value ₹ 1,50,000) was reduced to 40%.
What was the net decrease in value of assets?
1,90,000
9. ISC 2023
10. At the time of admission of a partner, recording of an unrecorded asset by the firm leads to:
(a) loss to the old partners.
(b) gain to the old partners.
(c) gain to all the partners.
(d) loss to all the partners. (ISC 2023 CE)

11. SP 2024
On the date of Som’s admission as a partner, it is decided that:
• Furniture (book value ₹ 2,50,000) be reduced by 40%
• Machinery (book value ₹ 1,50,000) be reduced to 40%
What is the net decrease in the value of the assets?
(a) ₹ 2,10,000
(b) ₹ 1,90,000
(c) ₹ 1,60,000
(d) ₹ 2,40,000

12. ISC 2024

13. ISC 2024

 LONG ANSWER

1. ISC 2011
Revaluation profit: 1000
Hidden goodwill of the firm: 30,000
Capital balances - D 23,400; B 16,600; C 16,000
Balance sheet total - 1,35,650
2. ISC 2013
3. ISC 2015
4. ISC 2017
Mike was taken as a partner for 1/4 P th share, with effect from 1st April, 2016, subject to the
following adjustments:
(a) Plant and Machinery was found to be overvalued by ₹ 16,000. It was to be shown in the
books at the correct value.
(b) Provision for Doubtful Debts was to be reduced by ₹ 2,000.
(c) Creditors included an amount of ₹ 2,000 received as commission from Malini. The necessary
adjustment was required to be made.
(d) Goodwill of the firm was valued at ₹ 60,000. Mike was to bring in cash, his share of
goodwill along with his capital of ₹ 1,00,000.
(e) Capital Accounts of Juliet and Rabani were to be readjusted in the new profit sharing
arrangement on the basis of Mike’s capital, any surplus to be adjusted through current account
and any deficiency through cash.
You are required to prepare: (i) Revaluation Account. (ii) Partners’ Capital Accounts. (iii)
Balance Sheet of the reconstituted firm
5. ISC 2018
6. ISC 2020
On 1st April, 2019, Mita is admitted as a new partner on the following terms:
(a) The new profit sharing ratio of Smita, Punita and Mita to be 5:3:2.
(b) Provision for doubtful debts to be raised to 10% of the debtors.
(c) Punita to take over the firm’s investments (not recorded in the books) at ₹3,000.
(d) Goodwill of the firm to be valued at ₹50,000. Mita to bring in cash for her share of goodwill.
(e) 50% of the goodwill to be withdrawn by the old partners.
(f) Mita to pay off the Bank Loan on behalf of the firm. The amount due to her by the firm, to be
considered as part of her capital contribution.
(g) Mita to bring in the balance of her capital in cash, so as to make her capital equal to 1/5th of
the total capital of the firm.
You are required to: (i) Pass journal entries at the time of Mita’s admission. (ii) Prepare the
Balance Sheet of the reconstituted firm.
7. ISC 2021
Revaluation Loss: 114000
NPSR : 4:5:3
Partners capitals: C 6,22,000; P 6,34,000; G 3,00,000
Balance sheet: 17,69,000
8. SP 2015
Anil and Sunil are partners sharing profits and losses in the ratio of 3:2. They admit Charan as a
new partner from 1st April, 2013. Anil gives 1/3rd of his share while Sunil gives 1/10th from his
share to Charan. Their Balance Sheet as on 31st March, 2013, is given below:

Terms of Charan‟s admission are as follows:

(a) Charan‟s brings in `30,000 as his capital. His share of Goodwill was determined to be
`18,000. He could bring in only 60% of his share.
(b) Land & Building was found to be undervalued by `10,000, stock was found overvalued by
`7,000 and provision for doubtful debts is to be made equal to 5% of the debtors.
(c) Capital accounts of the old partners to be re-adjusted in the new profit sharing arrangement
on the basis of Charan‟s capital, any excess or deficiency to be adjusted in cash. You are
required to:
(i) Pass journal entries (ii) Prepare Partners’ Capital Accounts (iii) Balance Sheet of the new
firm. Show your workings clearly.
9. SP 2017
Dhruv and Ansh are partners in a firm sharing profits and losses: Dhruv 75% and Ansh 25%
respectively. Their Balance Sheet as at 31st March, 2016 is given below:
On 1st April, 2016, Kavi is admitted as a new partner on the following terms:
(i) The value of stock is to be increased to ₹ 42,000.
(ii) Land and building is to be reduced by 20%.
(iii) Bad debts amounting to ₹ 1,800 are to be written off.
(iv) Creditors include an amount of ₹ 5,000 received as commission from Amar. The necessary
adjustment is required to be made.
(v) The liability on Workmen Compensation Reserve is determined at ₹ 3,000.
(vi) Kavi is to pay ₹ 15,000 to the existing partners as premium for Goodwill for 20% of the
future profits of the firm. He is also to bring in capital equal to 1/4th of the combined capitals of
Dhruv and Ansh.
You are required to:
(i) Pass journal entries on the date of Kavi’s admission.
(ii) Prepare the opening Balance sheet of the new firm on the completion of the transactions.
10. SP 2018
You are required to pass the necessary journal entries to carry out the following arrangements:
Antony and John are partners sharing profits in the ratio of 4:1. On 1st April, 2016, Ronny was
admitted into their partnership for 1/5th share in the profit which he acquired from Antony and
John in the ratio of 3:1. Ronny brings in ` 30,000 as his capital and ` 20,000 as his share of
goodwill. At the time of Ronny’s admission, the firm had an Investment Fluctuation Reserve of `
5,000 which the partners decided to show even in the reconstituted firm.
Profit of the firm for the year ending 31st March, 2017, was Rs 1,00,000. The firm followed the
fixed capital method.
11. SP 2018
Hari and Kavi are partners sharing profits and losses in the ratio of 3:2. They admit Ravi as a
partner who contributes ` 30,000 as his capital for 1/5th share in the profits of the firm. It is
decided that after Ravi’s admission, the capitals of the Hari and Kavi will adjusted on the basis
of Ravi’s share of capital in the business, any surplus or deficiency to be adjusted through
current accounts. Before any adjustments were made, the capitals of Hari and Kavi were: `
59,000 and ` 35,000 respectively. At the time of Ravi’s admission:
(a) The firm’s goodwill was ` 40,000.
(b) General Reserve was ` 25,000.
(c) Loss on revaluation of assets and liabilities was ` 4,000.
You are required to pass the journal entries to adjust the capital of the old partners.
H capital Dr 4,400
To H current

K current Dr 1,400
To K capital
12. SP 2023
Veena and Soma are partners in a firm. They admit Sara on 1st April, 2022, for 1 4 ⁄ share in the
profits of the firm. On an average, the profits earned by Veena and Soma are ₹ 21,000. The
average capital employed by the firm is ₹ 1,50,000. The normal rate of return in the industry is
10%. It is decided to value goodwill on the basis of four years’ purchase of profits in excess of
profits @ 10% on the money invested.
You are required to: (i) Calculate the goodwill of the firm. (ii) Pass the journal entries in the
books of the firm if Sara brings into the firm her share of goodwill in cash.
13. SP 2023
Amit and Barun are partners sharing profits in the ratio of 4:1. Their Balance Sheet as at 31st
March, 2022, was as under:
Balance Sheet of Amit and Barun As at 31st March, 2022
On 1st April, 2022, Charan is admitted as a new partner on the following terms:
(i) The new profit-sharing ratio of the partners to be 2:1:1.
(ii) Charan to bring in ₹ 16,000 as his capital but would be unable to bring his share of goodwill
in cash.
(iii) The value of the goodwill of the firm to be calculated on the basis of Charan’s share in the
profits and the capital contributed by him.
(iv) Furniture, which had been undervalued by ₹ 600 to be brought up to its revised value.
(v) Out of the total insurance premium paid, ₹ 3,400 to be treated as prepaid insurance.
The amount was earlier debited to Profit & Loss Account. You are required to prepare: (i)
Revaluation Account. (ii) Partners’ Capital Accounts.
Rev Profit: 4,000
Hidden goodwill of the firm : 10,000
Capital balances: A 25,400; B15,100 ; C 16,000
14. SP 2023
Karan and Vijay are partners in a firm sharing profits and losses in the ratio of 4:3. They admit
Shrey for 1/3rd share in the profits. On the date of Shrey’s admission:
(a) The capitals of Karan and Vijay are: ₹ 40,000 and ₹ 30,000 respectively.
(b) Profit and Loss Account has a debit balance of ₹ 7,000.
(c) General Reserve shows a balance of ₹ 21,000 which is not to be disturbed.
(d) Goodwill of the firm is valued at ₹ 42,000.
(e) The cash at bank is ₹ 15,000.
(f) Shrey brings in proportionate capital and his share of goodwill in cash.
You are required to prepare:
(i) Partners’ Capital Accounts.
(ii) Cash at Bank Account of the reconstituted firm on the date of Shrey’s admission.
Capital balances: K48,000 ; V 36,000; S 42,000
Cash balance: 71,000
15. ISC 2023

16. ISC 2023

17. ISC 2023 CE
Judy and Cathy are partners in a firm sharing profits and losses in the ratio of 3:2. Their Balance
Sheet as at 31st March, 2022, is given below:
Balance Sheet of Judy and Cathy
As at 31st March, 2022

On 1st April, 2022, Sandra is admitted as a new partner for 15 ⁄ share in the profits on the
following terms:
(a) Sandra brings in ₹ 30,000 as her capital and ₹ 5,000 as her share of goodwill in cash.
(b) Creditors of ₹ 2,000 are discharged by Cathy privately for which she is reimbursed.
(c) The market value of investments is determined at ₹ 40,000. These are taken over by Judy
and Cathy in the ratio of 3:2.
(d) A debtor whose dues of ₹ 15,000 were written off as bad debts, pays ₹ 10,000 in full
settlement.
(e) The capitals of Judy and Cathy are readjusted on the basis of their profit-sharing
arrangement, adjustments of capitals are made through cash.
You are required to prepare Partners’ Capital Accounts.
Revaluation Profit - Nil
Capital balances - J- 72000; C- 48000; S - 30000
Cash brought in- J 18000 ; C 10000
18. ISC 2023 CE

On 1st April, 2022, they admit Dhaval for 𝟏𝟓⁄ share in the profits.
Kamal and Vinay are partners in a firm sharing profits and losses in the ratio of 3:2.

On the date of Dhaval’s admission:

[

(a) The capitals of Kamal and Vinay were: ₹ 40,000 and ₹ 30,000 respectively.
(b) The Advertisement Suspense Account had a debit balance of ₹ 6,000.
(d) Goodwill of ₹ 4,000 existed in the books.
(e) There were creditors of ₹ 15,000 out of which ₹ 5,000 were paid off by Kamal for which he
was not to be reimbursed.
(f) Furniture of ₹ 2,000 was taken over by Vinay at its book value.

(h) Dhaval contributed 𝟏𝟒⁄ of the combined capital of Kamal and Vinay and his share of goodwill
(g) Goodwill of the firm was valued at ₹ 25,000.

in cash.
You are required to prepare Partners’ Capital Accounts.

19. SP 2024
Amit and Pavan are partners in a firm with capitals of ₹ 35,000 each. They shared profits and

On 1st April, 2023, they admit Charu as a new partner for 15⁄ share in the profits. Charu brings
losses in the ratio of 3:1.

in ₹ 40,000 as her share of capital.

Goodwill of the firm is based on Charu’s share in the profits and the capital contributed by her.
Charu brings her share of goodwill in cash.
At the time of Charu’s admission:
(a) The firm had a General Reserve of ₹ 60,000 from which ₹ 20,000 is to be set aside as
provision for doubtful debts.
(b) Creditors of ₹ 8,000 are paid by Amit privately for which he is not to be reimbursed.
(c) There is no change in the value of other assets and liabilities.
You are required to pass necessary journal entries on Charu’s admission.
Hidden goodwill- 42000
20. SP 2024

On 1st April, 2022, they admit Akhil as a partner for 15⁄ share in the profits. Akhil acquires 15⁄ of
Sharan and Angad are partners in a firm sharing profits and losses in the ratio of 3:2.

his share from Sharan and the balance from Angad.

On the date of Akhil’s admission, the goodwill of the firm was valued at ₹ 90,000.
Akhil contributed the following assets towards his capital and his share of goodwill.

You are required to:

(i) Calculate the sacrificing ratio of the partners.
(ii) Pass the necessary journal entries on Akhil’s admission, ascertaining Akhil’s capital
contribution and assuming that he brings into the firm his share of goodwill in cash/ kind.
SR - 1:4

21. ISC 2024

22. ISC 2024