Accountancy

Chapter 5 - Retirement & Death of a Partner

TRUE- FALSE QUESTIONS

Q.1 The amount paid to the retiring partners is excess of his capital after adjusting accumulated
profits/losses revaluation profits/losses, share of goodwill etc is taken as his share of hidden
goodwill of the firm
Q.2 Death of a partner is like a compulsory retirement
Q.3 Share in profit of deceased partner is transferred to P&L suspense A/c
Q.4 In case, goodwill account written off the capital account of all partners is credited.
Q.5 Provident Fund is credited to all partners in their old ratio at the time of Retirement of a
Partner.
Q6 Gaining Ratio = New Profit-sharing Ratio – Old Profit-Sharing Ratio.
Q7 The amount due to retiring partner, if not paid in cash, is transferred to his loan
Account
Q8 At the time of retirement or death of a partner, the undistributed profits or losses
and reserve are distributed among all partners in their old profit-sharing ratio
Q9 In the event of death, the combined share of profits of the continuing partners
Will decrease.
Q 10 A family member of the retiring partner will automatically become the new partner
in a reconstituted firm.

KVS ZIET BHUBANESWAR 12/10/2021 Page 1

 ANSWER KEY
Q.1 True

Q.2 True

Q.3 True

Q.4 False

Q.5 False
Q6 False
Q7 True
Q8 True
Q9 False
Q 10 False

PREPARED BY THE PGTs ( COMMERCE ) OF BHUBANESWAR,

GUWAHATI, KOLKATA, RANCHI, SILCHAR AND TINSUKIA REGIONS.

KVS ZIET BHUBANESWAR 12/10/2021 Page 2