XIN

MCO.56 An Ald to Acountany--C

4.ADMISSION OF APARTNER

Multiple CholceQuestlons(MCOB))
Select the correet alternattue:
1. Hew partner may be admitted to partnership

with the consent of majortty of the partners.

the consent df 3/4th of the old partners.
with
Owith the consent of all the old partners.

with the consent of 2/3td of the old partners.

2. When a new partner is admitted in the firm,

old partners gain in profit-sharing ratio, old partners loose in profit sharing ratio.
partner gains while others loose. Not affected at al.
O only one

3. Sacrficing Ratio ls

Old Profit-sharing Ratio New Profit-sharing Ratio.

New Profitsharing Ratio Old Profit-sharing Ratío.

Equal to Old Profit-sharing Ratio.
Equal to New Profit-sharing Ratio.
4. The account which shows change in the value of assets and liabilities is known as

Profit and Loss Account Profit and Loss Approprlation Account.

Current Acount. Revaluation Account.
5. General Peserve at the time d admission ofa partner is transferred to

Revaluation Account. t h e credit of Old Partners Capital Accounts

t h e debit od Old Partners Capital Accounts. the credit of Captal Accounts of all the Partners

acumulated Proftslosesratio. transemed to the Capital Accounts of old partners in

are

New profit sharing o l d profitsharlng ratlo.

Capital Ratl None ofthese.
7. The asset that normally s valued/revalued at the time of admission of a new partner is

Goodwil Fixed Assets.

Stoch OInvestments.
8. In the Balance Sheet prepared after the new partnership agreement, Assets and Liabilitles are usualy
shown at
O Original Value. Revalued Value or Amount.
Realisable Velue. Current Cost.
9. X and Y are sharing profits and losses In the ratio of 3: 2. They admit Z as a partner and glve him
2/10th share in the profits. The new profitsharing ratio will be
12:8:. 3:2:2
3:2:5. 2:1:2.

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Multiple Choice Questions MCQ.57
10. Shlv and Mohan are sharing profits and losses In the ratlo of 5:3. They admit Jla as a partner ana give ner
3/10th share of the profits. He takes this share as 1/5th from Shiv and 1/10th from
New profit-sharing ratio will be
Mohan
5:6:3. 2:4:6.
O17:11:12. 18:24:38.
11. Gain (Profit) or Loss on revaluation
ACcounts in their
of assets and reassessment of liabilities is transferred to Partners' Capital

Capital Ratio. Equal Ratio.

Old Profit-sharing Ratio. Gaining Ratio.
12. A firm has an unrecorded investment of 10,000. Journal entry to record the unrecorded investment on
admission ofa partner will be:

Revaluation A/e
To Unrecorded Investment A/c
Dr. 10,000
T 10,000
Unrecoded Investment A/c .Dr. 10,000
To Revaluation A/c 10,000
Partners Capital A/c
To Unrecorded Investment A/c
Dr. 10,000
R10,000
None of the above.
13. X,Y and Z who are sharing profits and losses in the ratio of 5:3:2, decide to share future profits and
losses In the ratio of 2:3:5 wef. 1st April, 2021, after admission of A. An extract of the Balance Sheet as at
31st March, 2021 is as follows:
Labilities Assets
Creditors 2.00.000 Plant and Machinery 2,00,000
Less: Provision for Depreciatlon 10,000 1,90,000
0 F Plant and Machinery is valued at 1,71,.000, the Journal entry will be:

Revaluation A/e
To Provision for Deprecilation
Dr. 19,000

on Plant and Machinery Nc R19,000

and
Plant Machinery Ac
To Revaluation A/c
Dr 19,000
719,000
Revaluation A/c
To Plant and Machinery Alc
.Dr. 19,000
19,000
Provision for Depreclatlon
on Plant and Machinery AWc Dr. 19,000
To Revaluatlon A/c R19,000
() If creditors of 10,000 were not recorded and are now to be recorded, the Journal entry will be

Revaluation A/c Dr. 10,000

To Creditors 10,000
Creditors AVc 10,000
To Revaluatlon A/c 10,000
Revaluatlon A/c
To Creditors AVc
210,000
R2,10,000
Creditors AVe Dr. 2,10,000
To Revaluation A/e 2.10,000

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 MCQ.58 An Aid to
Accountancy-CBSE XII
14 Whena new parter is admitted he is entitled to a share of
Past profits
Present profits.
OFuture profits
Reserve appearing in the Balance Sheet of the firm.
15. Which of the
following statement is incorrect in case of admisslon of a partner?
8 hcrease in the value of asset will increase capital.
Increase in the value of asset will decrease capital.
O Increase in the value of liability will decrease capital
Decrease in the value of liability will increase capital.
16. Premium paid by a new partner in addition to the capital brought in, is meant for

Creditors Goodwil.
Loan.
Mortgage.
17. Aditya and Shiv were partners in a firm with
capitals of 3,00,000 and 2,00,000, respectively. Naina was
admitted asa new partner for 1/4th share in the profits of the fim. Naina brought 1,20,000 for her share of
goodwill premium and 240,000 for her capital. The amount of goodwill premium credited to Aditya will be
O40,000o. 30,000.
O 72,000. 60,000. (CBSE 2020)
18. Unrecorded assetsor liabilities are transfered to
Partners' Capital Accounts.
Profit and Loss Account.
Revaluatton Account
Partners' Current Accounts.
19. Mand Nare partners in a firm sharing profits and losses in the ratio of S:3. On 1st April, 2021, they admit
Ras
partner. The
a
profit-sharing ratio of M, Nand Rwill be 7:5:4.The sacrificing ratio of Mand Nis
new

O 5:3.
3:1
3:2 4: 5.
20. Niyati and Aisha were partners in a firm sharing profits and losses in the ratto of
a new partrner. Niyati sacrificed 1/4th from her share and Aisha sacrificed 17th 4:3. They admitted Bina as
from her share in favour of
Bina. Bina's share in the profits of the fim will be:
2/7 11/28
10/49 7/16 (CBSE 2020)
21. Goodwill brought by the incoming partner is distributed among the old their
partners in
o l d profit-sharing ratio. New profit-sharing ratio.
Sacrificing ratio. Gaining ratio.
22. When 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
o l d profit-sharlng ratio. D New profit-sharlng ratio.

Sacrificing ratio. Gaining ratio.

23. A and B are partners sharing profits In the ratlo of 2: 3, they admit C as a patner for 1/4th share, the
sacrificing ratio of A and 8 will be
O 2:3.
1:1.
3:2 2:1.

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Multiple Choice Questions
MCQ.59
24. When a new partner is admitted, the balance of 'General Reserve' appearing in the Balance Sheet at the
time of admlssion ls credited to
Profit and Loss Approprlation Account.
Capltal Accounts of all the partners.
Capital Accounts of Old Partners.
25. Anita and Babita
Revaluatlon Account. AI 2015 )
were partners sharing profits and losses In the ratlo of 3:1. Savita was admitted 1/5th
share In the
profits. Savita was unable to bring her share of goodwill for
recorded for premlum for goodwll ls as below: premium in cash. The Journal entry

Date Particulars
Savita's Current AVe L Dr.() Cr. )
To Anlta's Capital AWc 24,000
To Bablta's Capital A/c
8,000
16,000
Adjustment of goodwill premium on Savita's Admisslon)

The new
profit-sharing ratio of Anita, Babita and Savita, wlI be
O41:7:12
13:12:10.
O 3:1:1. 5:3:2. (CBSE 2020)
26. Sunand Star
were partners in a firm sharing profits in the ratio of 2:1. Moon
in the firm. New
was admitted as a new partner
goodwill and his capitak
profit-sharing
ratio was 3:3:2. Moon brought the
following assets towards his share af

Machinery 2,00,000
Furniture
1,20,000
Stock 80,000
Cash 50,000
fhis capital is considered as 3,80,000, the goodwll of the firm will be:
O T 70,000.
280,00o.
4,50,000. 140,000. (CBSE 2020)
27. Mona and Tina were partners in a firm
sharing profits in the ratlo of 3:2. Naina was admitted with 1/6th
share in the profits of the firm. At the time of admlsslon, Workmen's
Balance Sheet of the firm at 32,000. The claim on account of workmen's
Compensation Reserve appeared in the
at 40,000. Excess of clalm
compensation was determined
over the reserve will be

Credited to Revaluation Account. Debited to Revaluatlon Account.

Credited to old partner's Capital Account. Debited to old partner's Capital Account.
(CBSE 2020)
28. Partners Capital A/c is debited
t o record galn (profit) on revaluation. 6torecord the General Reserve.
t o record loss on revaluatlon. t o record the capltal brought in.
29. Mita and Sumit are partners In a firm with capitals
of 6,00,000 and 4,00,000 respectively. Keshav was
admitted asa new partner in
tor 1/5th share the profits of the
goodwill premlum and t3,00,000 of his capltal. The amount offirm. Keshav
goodwll
brought 40,000 as his share of
premlum credited to Sumit will be

20.000. 24,000.
O 16,000. 40,00. (CBSE 2020)

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 XII
MCQ.60 An Aid to Accountancy-CBSE

30. Xand Yare partners

sharing profits in the ratio of 3: 1. They admit Z as a partner wno py that will be
. Ine new
profit-sharing ratio is 2:1:1 among X, Yand Z. The amount of goodwill
credited to
O Xand Yas 30,000 and T 10,000. X only.
O Yonly. N o n e of these.

in the firm for 1/4th

LnaM Share profits of a business in the ratlo of 5:3. They admit firm is partner
Nas a share
to be valued at 4
profits. For the purpose of admission of N, Goodwill of the years purchase
n the is 20,000. Normal Profit
or the Average Super Profit of the last 3 years. Average Profit of the last 3 years
is12,000.
() The new profit-sharing ratio is
4:3:1. 3:3:2.
O 4:2:1.
O15:9:8.
G1) For adjustment of goodwill,the entry wll be:
w ' s Capital Nc 8,000
To LsCapital Nc 8,000
w ' s Capital Nc Dr. 8,000
To L3Capital Ac 5,000
To Ms Capital A/c 3,000
6,000
N'sCapital Ne
To LsCapital Vc 3,000
To Ms Capital A/c 3,000
Ns Capital Ae 8,000
To LsCapital A/c 3,000
To MsCapital A/c 5,000

32. Increase in the value of liabilities at the time of admission of a partner is

Debited to Revaluation Account. Credited to Revaluation Account.

Credited to Partner's Capltal Account Debited to Partner's Capital Account.
33. For which of the following situations, old profit-sharing ratio of partners is used at the time of admission
ofa new partner?
OWhen new partner brings only a part of his share of goodwill
When new partner is not able to bring his share of goodwill.
OWhen, at the time of admission, goodwill already exists in the Balance Sheet.
When new partner brings his share of goodwill in cash. (CBSE Sample Paper 2020)
34.
ABandCae equalpartners.Disadmittedasa partnerinthefimfor 1/4thshare. Dbrings t20,00
and 5000 being half of the premium for goodwill. The value of goodwill of the firm is
as capital

O10,000. T40,000o.
O 20.00 None of these.
35 Pand0 are partnes in a fimm having capitals of 15,00 each. Ris admited as a partner for 1/3rd share
for which hehas to bring 20,000 for his share of capital The amount of goodwill will be
8.000. 10,000.
T9,000. 11,0.

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Multiple Choice Queatians MCQ61
J6. When the new
partner brlngs cash for gaodwill, the amount s credited to
ORevaluation Account Cash Account.
OPremlum for Goodwll Account. Reallsatlon Account. (CBSE Delhl 2015 )
37. X and Y are partners with
capltals of t 18,000 and 12,000 respectlvely. A new partner 2 s
with 1/5th share In proflts. He brings 14,000 for hls capltal. Proflt and Loss Ac has a credit balance or admitted
10,000 on the date of admisslon of Z. Value of
hidden goodwll at the tlme of Zs admission will be
16,00o. 25,00.
20,00o. None of these.
38. Xand Yshare profts and losses In the ratlo of
They take Z as a partner and the new profit-sharing
2:1.
ratio becomes 3:2:1.Z brings 9,000 as premlum for goodwill. The full value of goodwill will be
O 60,000
36,000
S4,000. 27,000.
39. At the time of admisslon, If the
ratio will bee
proft-sharlng ratlo among the old partners does not change then sacrifking9
equal. according to the contributlon of captta
their old profit-sharing ratlo. accordlng to new partner.

Assertion-Reason Based Questlons

Given below are two statements (In each questlon), one labelled as Assertlon
(A) and other labelled as Reason
1. Assertlon (A): Admisslon of a
partner means reconsttutlon of the
(R)
partnership whereby
old partnership
ceases to exlst and new partnershlp comes Into exlstence.
Reason (R): When a partner Is admitted, number of partners Increase and also the
changes. However, the firm contlnues. Thus, it Is a reconstitutlon of partnership
profit-sharing ratio

In the context
of above two statements, which of the following Is correct?
OAssertion (A) and Reason (R) are correct but the Reason (R) ls not the correct explanation of
Assertion (A).
Both Assertlon A) and Reason (R) are comect and Reason (R) s the correct explanatlon of Assertion (A).
Assertion (A) Is correct but the Reason (R) Ls not correct.
Both Assertlon (A) and Reason (R) are Incorrect.
2. Assertion (Ak Admisslon of a partner leads to dissolutlon of old firm and
bringing new firm Into existence.
Reason (R: Asa result of admlsslon of a partner, old partners along with the new partner constitute the new
fAm. Thus, old firm Is dlssolved and new fm comes Into extstence.
the contert of above two statements, which
inAssertion of the following is correct?
(A) and Reason (R) are correct but the Reason (R) Is not the correct explanation of
Assertion A.
Both, Assertion (A) and Reason [R) are correct and Reason (R) is the corect explanaton of Assertion (A).

Only Assertlon (A) Is corect.

Both Assertlon (A) and Reason (R) are Incorrect.
3. Assertlon (A): Admlsslon of a partner leads to a situatlon where one or more partners forego thelr profit
share in favour of the new partner.
Reason (R): New partner can be glven addlitional profit share whlle profit shares of old partners are
not changed.

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 MCQ.62 An Ald to Accountancy-CBSE XIT

in the context of above two statements, whkh of the followlng is corec

Aserton t and Reason (R) are corect but the Reasaon (R) Is not the corect explanatlon of
Assertlon (A).

the corect explanation of Assertlon ().

Boy Assertion (A) and Reason (R) are correct and Reason (R) s
Assertion (A) s correct but the Reason (A) s not correct.
Asertion () s not correct but the Reason (R) s corect
4Assertlon (A: At the time of admilan of a partner, value of Goodwill of the firm is determined because
new partner compensates the sacrifcing partner or partners.
Reason (RI: Goodwill of the frm Is valued at the time of admission of a partner because the new partner
s the Gaining Partner and he will compensate the Sacrificing Partner or
Partner
In the context of above two stotements, which of the folowing s correct?
Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of
Assertion (Al.
Bothy Assertion (A and Reason ( are corect and Reason is the comect explanation of Assertion (A).
Only Assertion (A) is correct.
Both Asserton (A) and Reason (R) are Incorrect.
5. Assertion (A: At the time of admission of a partne, new partner should bring his share In goodwillin
cash to compensate the Sacrifcing Partner.
Reason (R: New partner may or may not bring his share of goodwll In cash to compensate the
Sacrificing
Partner or partners. Sacrificing Partners may be compensated by deblting new partner's
Current Accounta d crediting Sacrficing Partners Captal Accounts
In the context of obove two statements, whlch of the following ls correct?

O Both, Assertion (A) and Reason (R) are corect and Reason (R) is the correct explanation of Assertion (A.
Assertion (A) and Reason (R) are correct but the Reason (R) Is not the correct explanation of
Assertion (A).
Assertion (A) Is correct but the Reason (R) is not correct.
O Assertlon (A) is not correct but the Reason (R) is correct.
Assertion (A): Ajeet and Akash are partners sharing profits in the ratio of
3:2.They admit Prakash as a new
partner for 1/4th share. Goodwill ls valued at ? 1,00,000 and new Partner will
compensate
both AJeet and Akash by crediting R 25,000 In the ratio
of 3:2.
Reason (R): Prakash has taken 1/4th share in profits and therefore he will bring 1/4th Goodwil, ie.
25,000. Since, Sacrificing Ratio or the new profit-sharing ratio ls not glven, AJeet and Akash
have sacriflced In the ratio of 3 :2. Therefore, they will be compensated in the ratio of 3:2.
In the context ofabove two statements which of the following Is correct?
Assertion (A) and Reason (R) are correct but the Reason (R) Is not the correct explanation of
Assertion (A.
Both Asertion A and Reason a e conect and Reason ( s the corectexplanstionof Asserton (.
Asserton (A) s correct but the Reason (N) is not corect
Both Assertion (A) and Reason (R) are not correct.
 Multiple Choice Questioms MCQ.63
7. Assertion (A): General Reserve Is not distrlbuted among the old partners but is carrled forward In the
Balance Sheet prepared after admlsion of a partner
Reason (R: General Reserve ls set aside out of past profits and therefore, itis distrlbuted among old partners
in their old profit-sharlng ratio.

in the context ofabove two statements, which of the foliowing is correct?

Assertion (A) and Reason (R) are correct but the Reason (R) Is not the correct explanation of
ASsertion (A).
OBoth, Assertion (A) and Reason (R) are comect and Reason (R) s the correct explanation of Assertion .
Only Assertion (A) is correct.
Assertion (A) Is not correct but the Reason (R) Is correct.
8. Assertion (A): Ajay and Akansha are partners sharing profits in the ratio of 3:2. General Reserve existed in
the books at 1,00,00.They admited Amit as a partner for 2/5th share in profts. 7 50,000
was transferred to Workmen Compensation Reserve and balance was transferred to Capital
Accounts of Ajay and Akansha In the ratio of 3 :2.
Reason (R): General Reserve Is a free reserve and can be used for
any purposes as ls decided by the
partners. The partners may transfer S0,000 to Workmen Compensation Reserve and transfer
the balance R 50,000 to the Capital Accounts of Ajay and Akansha in the ratio of 3:2.
In the context of above two statements, which of the following is corect?
Both, Assertlon (A) and Reason (R are comrect and Reason (R) is the correct explanation of Assertion (A
Assertion (A) and Reason (R) are correct but the Reason (R) Is not the correct explanatlon of
Assertion (A).
Assertion (A) Is correct but the Reason (R) is not correct.
Both Assertion (A) and Reason (R) are Incorrect.
9. Assertion (A): Bhaskar, Suman and Sumit are partners
sharing profits equally. They admitted Sahil for
2/10th share and the new profit-sharing ratio is 3:3:2:2.Workmen
Compensation Reserve
existed In the books at 2,00,000 and a caim by workers of t 40,000 also existed. It
was
decided to provide for the dlaim. 1,60,000, the balance
Reserve will be transferred to the
of Workmen's
Compensatlon
Capital Accounts of Bhaskar, Suman and Sumit equally.
Reason (R: Workmen Compensation Reserve to the extent of 1,60,000 is a free reserve and is transferred
to the Partners Capital Accounts In their old profit-sharing ratlo, it belng a reserve set aside
from past profits.
In the context of above two statements, which of the
following is correct?
Both, Assertion (A) and Reason (R) are correct and Reason R) s the comect explanation of Assertion (A).
Assertion (A) and Reason (R) are corect but the Reason (R) is not the correct explanation of
Assertlon (AA
Assertlon (A) is comect but the Reason (R) is not correct.

Both Assertion (A) and Reason (R) are notcorrect.

10. Assertlon (A): Parul and Paresh are partners sharing profits
equally. They admit Prerma for 1/4th share in
future profits. On the date of admission, Workmen Compensation Reserve exdsted
In the
books at 1,00,000. A claim of ?
1,50,000 was made bya worker and
The existing reserve of 1,00,000 wll be distributed between Parul and
was to
be accounted.
Paresh and
1,50,000 being the clalm amount i l be transferred to the debit of Revaluation Account.
 An Aid to Accountancy-CBSE XII
MCQ.64
Reason (R): Workmen Compensation 1,00,000 will be transferredto WorkmensCompensation
Reserveof and credited to
debited to Revaluation Account
Claim Account. In additlon, 7 50,000 be
Workmen's Compensation Claim Account.

In the context of above two statements, which of the following is corect?

are correct but the Reason (R) is not the
correct explanation of
Assertion (A) and Reason (R)
Assertion (A)
is the comrect explanation of Assertion (A).
Both, Assertlon (A) and Reason (R) are corect and Reason (R)
Assertion (A) is correct but the Reason (R) is not correct.
(A) is not correct but the Reason (R) is correct.
Assertion
Param as a partner and thelr
11. Assertlon (A}: Karan and Raman are equal partners. They admitted
new

and Raman is 1:1.

profitsharing ratlo was 2 sacrificing ratio
:2:1. The of Karan
Reason (R): A change in the values of assets and liabilities is credited/debited to Revaluation Account.

In the contert of above two statements, which of the following is correct?

Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of

Assertion (A).
Both, Assertion (A) and Reason (R) are corect and Reason (R) is the correct explanation of Assertion (A
Only Asserton (A) is correct but the Reason () is not carrect
(A) and Reason (R) incorrect.
Both Assertion are

12. Assertlon (A): Gurman and Ravi are equal partners. They admitted Paramas a partner and their new profit
sharlng ratlo was 2:2:1. They revalued the assets and reassessed thelr liablities. They did
so because new partner should not be at an advantage or disadvantage
Reason (R Assets and lablties that exist before admission of Param are revalued/reassessed because
Increase in value of assets and decrease in value of labilities and vice versa Is for the period
before admlsslon of Param.If the change in values is accounted, Param wll be at an advantage
or disadvantage.
In the context of above two statements, which of the following is correct

Assertlon (A) and Reason (R) are correct but the Reason (R) Is not the correct explanatlon of
Assertlon (A.
Both, Assertion (A) and Reason (R) are corect and Reason ) is the correct explanation of Assertion (A
Assertion (A) Is correct but the Reason (R) is not correct.

Assertion (A) Is not corect but the Reason (R) is correct.

13. Assertion (A): Harl and Nimrat are equal partners They admit Kabir as a partner for 1/4th share. The value of
assets was increased by1.00.000 and an unrecorded liability of t 40,000 was brought into books.
The gain profit) of 60,000 will be credited in the capital accounts of Harl and Nimrat equally.
Reason (R): Galn (profit) or loss on revaluation of assets and reassessment of labllties Is credited or
debited to the Capital Accounts of old partners in their old profit-sharing ratio.
In the context of above two statements, which of the following is corect?

Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation o
Assertion (A).

Both, Assertion (A) and Reason (R) are comect and Reason (R is the corect explanationof Assertion A
Assertion ()s correct butthe Reason (R s not correct.
Both Assertlon (A) and Reason (R) are not correct.

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Multiple Choice Questions MCQ.65
14. Assertion Ak Accrued income not recorded is shown In thecreditofRevaluation Account on admission of
a partner.

Reason (R): It being an income that relates to the period before admission of a partner. Thus, it Is credited
to Revaluation Account and net gain (profit) or loss of Revaluation Account is transferred to
old
partners capital accounts in their old
profit-sharing ratlo.
In the context of above two statements, which of the
folowing is correct?.
Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of
Assertion (A)
Both, Assertion (A) and Reason ) are correct and Reason (R) is the correct explanation of Assertion (A)
Only Assertion (A) is correct.
Assertion (A) is not correct but the Reason (R) is correct.
15. Assertion (A}: On admission of a partner, it is important to determine Sacrificing and Gaining Ratios
because sacificng partner or partners are compensated by paying goodwill on the basis
of the Sacrificing Ratio by the Gaining Partners.
Reason (R): Sacrificing Partners are compensated by the Gaining Partners for the sacrifice made by each
partner in their Gaining ratio.

In the context
of above two statements, which of the following is correct?
Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanatlon of
Assertlon (A).
OBoth, Assertion (A) and Reason (R) are corect and Reason (R) Is the correct explanation of Assertlon (A).
Only Assertion (A) Is correct.
Both Assertion (A) and Reason (R) are not correct.
16. Assertion (A): Anahat and Parminder are partners sharing profits in the ratio of
2:1. They admit Rubayat
as partner wef 1stJanuary, 2021.On that date, Goodwillexdsted in the books at 71.0,.000.
Goodwill of T S0,000 was written off by debiting capital accounts of Anahat and Parminder
in the ratio of 2:1 while balance goodwill was carried forward In the Balance Sheet.

Reason (R: Goodwill existing in the books is purchased goodwill and therefore, is not written off.
In the context ofabove two statements, which of the following is correct?
Assertlon (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of
Assertion (A).
Both, Assertion A) and Reason (R) are correct and Reason R) Is the correct explanatlon of Assertlon A.
Only Assertion A) is correct.
Both Assertion (A) and Reason (R) are not correct.
17. Assertlon (A): Dev and Anil are partners sharing profits in the ratio of
3:2. They admit Ramesh into
partnership for 1/4th share on 1st April, 2021.On that date Deferred Revenue Expenditure
existed in the books at T 1,00,000. They carried it in the books of the firm because the
expenditure wll give benefit for the next five years
Reason (R): Deferred Revenue Expenditure is written off on reconstitution of the firm and Is not
carried forward.
 An Atd to Accountancy-CBSE XII
MCQ.66
in the context of above two statements, which of the following s cornect?
(R) Is not the correct explanatlon of
Assertlon (A) and Reason (R) are correct but the Reason
Assertlon (A).
(A.
correct and Reason (R) is the correct explanatlon of Assertion
Both, Assertlon (A) and Reason (R) are
Only Assertion (A) Is correct.
Assertlon (A) ls not correct but the Reason (R) ls correct wer
18, Assertion (A): Atuland Bhushan are partners sharing profits equally. They
admlt into partnership
Bharat
debit balance In Profit & Loss Account
1st April, 2021 for 1/5th share In profits. On that date,
a

accounts of Atul and Bhushan equally.

existed at so,000. It will be written off to the capltal
In Profit & Loss Account Is a fictltlous asset
and all fictitlous assets are written
Reason (R): Deblt balance In the old
the capltal accounts of old partners
off at the time of reconstltutlon of the Mrm to
profit-sharling ratio
In the context of above two statements, which of the following is correct?
of
Assertion (A) and Reason (R) are correct but the Reason (R) ls not the correct explanation
O
Assertlon (AA
(R Is the correct explanatlon of Assertlon (A).
Both, Assertlon (A) and Reason (R) are correct and Reason
Both Assertion (A) and Reason (R) are not correct.

(A) Is not correct but Reason (R) Is correct.

Assertlon
19. Assertion (A): Preet and Shlrin are equal partners. They admit Maira as a partner for 1/4th share In proflts.
Land of book value ? 3,00,000 is Increased by R 2,00,000 and computers of 2,00,000 were
reduced to e 1,00,000. New value of land will beR 5.00,000 and computers 1,0,.000.
Reason (R): The expresslon increased by' means that much value is to be added to the book value of the
asset. Therefore, value of land will be 5.00,000. The expression 'reduced to' means that t ls
the new value of the asset. Therefore, computer wll be shown at 1,00,000.
In the context of above two statements, which of the following Is correct?
Assertlon (A) and Reason (R) are correct but the Reason (R) Is not the correct explanation of
Asertion (A).
Both, Asertion A and Reason IR are coect and Reason (R is the comect explanatlon of Assertion (A.
Only Assertion (A) Is correct.
Assertlon (A) Is not correct but the Reason (R) is correct.
20. Asserton (AJ: Zubin and Zeenat are equal partners. They admit Ruksana into partnershlp for 1/3rd share
In proflts. Reassessing the liablitles, it was found that sundry creditors of 1,00,000 are not
payable and also there was an unrecorded liability of Customer Clalms of T 1,00,000, which
Is to be recorded. As a result of these
adjustments, loss on revaluation will be nl.
Reason (R): Sundry Creditors are reduced by ? 1,00,000 and a new
labllity of same amount towards
Customer Clalms has arisen. As a result, there Is nelther galn
(profit) nor loss on this account.
In the context of above two stotements, whch of the
following s correct?
Assertion (A) and Reason (R) are correct but the Reason (R) Is not the correct explanation of
Assertlon (A.

Both, Assertion A) and Reason (R) are correct and Reason R) is the comect explanation of Asserton (A.
Assertion (A) Is correct but the Reason (R) Is not correct.
Both Assertion (A) and Reason (R) are not correct.
Multiple Choice Questions MCQ.67

21. Assertion (AJ; Jas5 and Reet are equal partners. They admit Harry as partner for 1/6th share in future
profits. Their profit-sharing ratio after admisslon of Hary Is 3:2:1.As a resut of this, proit
share of Reet has not
changed.
Reason (R): Profit share of Jass before and after the
admission of Harry has not changed. Before admisslon
of Harry, his profit-share was h and after admission also It is % orh.
in the context of above two
statements, which of the following is correct?
O Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of
Assertion (A).
5 0 , Assertion (A and Reason ( are corect and Reason (R) s the corect explanation of Assertion (A.
OOnly Assertion (A) is correct.
Assertion (A) is not correct but the Reason (R) is correct.
22. Assertion (A): Ashish and Deepak were partners sharing profits and losses equally. They admit Vinod as
a parther for 1/5th share. Goodwill was valued at 7 1,00,.000. Ashish and Deepak will be
compensated by Vinod paying goodwill of R 10,000 each.
Reason (R): Both Ashish and Deepak t acrifi
Ashlsh and Deepak In equal equally. Since Vinod has taken 1/5th share from
proportion, ie., 1/10th share each, he willcompensate each by
paying goodwll of ? 10,000 belng equal to 1/10th of 1,00,000.
in the context
of above two statements, which of the following is corect?
Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of
Assertion (A).
DBoth, Assertion (A) and Reason (R) are correct and Reason (R) Is the correct explanation of Assertion (A).
OAssertion (A) is correct but the Reason (R) Is not correct.
Assertion (A) Is not correct but the Reason (R) is correct.
23. Assertlon (A): Admission
of partner
does not mean dissolution ofthe flrm but dissolution
and new partnership coming into existence.
of old partnership
Reason (R: Admission of a partner means reconstitution of the partnership whereby the firm continues.
In the context of above two statements, which of the
following is correct?
Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of
Assertion A).
Both, Assertion (A) and Reason (R) are comect and Reason (R) ls the correct explanation of Assertion (A.
Assertion (A) Is correct but the Reason (R) Ls not correct.
Both Assertion (A) and Reason (R) are not correct.
24. Assertion (A}: Raj and Hasmukh are partners in a firm sharing profits and losses in the ratio
of 2:1.
admit Garima as partner for 1/6th share. Thus, the new profitsharing ratio is 10:5:3.
They
Reason (R): Profit share sacrificed by Ral Is 2/18 (1/6x 2/3). Thus, his new profit share is 10/18 (2/3-2/18).
Profit share sacrificed by Hasmukh is 1/18 (1/6 x 1/3). Thus, his new profit share Is 5/18 (1/3
-1/18). New profit-sharing ratio is 10:5:3.
Ih the context ofabove two statements, which of the following is corect?
Assertion (A) and Reason (R) are correct but the Reason (R) is not the correct explanation of
Assertion A
Both, Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (AA
Assertion (A) ls corect but the Reason (R) Is not correct
Assertion (A) s not correct but the Reason (R) is correct
MCQ68 An Aid to Accountancy-CBSE XII

B. Assertion (A}: Adityaand Shivwere partners ina firm with capitals of 3,00,000 and200,000, respectively.
as a new partner for 1/4th share in the profits
of the fim. Naina brought
was admitted 240,000 for her capital. The amount of
1,20,000 for her share of goodwill premium and
goodwill premium credited to Aditya will be 60,000.
Reason (RE Profit shares sacrificed by Aditya and Shiv are 1/8th each as their profit-sharing ratio was equal
Goodwill Premium brought by Naina is 120000which will be shared by Adlitya and Shv equally,

in the contextofobove two statements, which of the following is correct

(R) is not the correct explanation of
Assertion (A) and Reason (R) are corect but the Reason

Assertion A)
Assertion (A.
and Reason (R) is the comect explanation of
O Both, Assertion (A) and Reason R) are corect
is not correct.
Assertion A) is corect but the Reason (R)
Both Assertion A) and Reason (R) are not corect.
O

Case Study Based Questions

Water Botting and marketing lt In the name
1. Amitabh and Bachan are partners in the business of Purified
ofPure Water. Balances in Accounts are 6,00,000 and 4,00,000 respectlvely while balances
their Capital the ratio of 3 : 2.With the
in their CurTent Accounts are 1,00,000 each. They share profits and losses in
as a partner for 1/6th share on 1st october,
2020.
aim to take the business to next level, they admit Charu
Charu brings (the much required funds) 5.00,.000 as Capital and 60,000 as her share of goodwill
Is not entered
Amitabh gives a loan of 5,p0,000 on the same day to the fim for which formal agreement
5% pa. On 1st Januay, 2021, Bachan took a loan of
into but all the partners later agree to pay interest
2,00,000 for personal use, t was without an agreement

On the basis of above infomation, choose the correct options to the following questions.
0 Amitabh wants that goodwill brought by C should be shared by A and 8 in the ratlo 3:2
However, Bachan is of the opinion that Goodwill should be credited to his capltal account. The correct
statement s

be credited to old partners In thelir

Amitabh is correct because Goodwill should always
old profit-sharing ratio.

8achan is coect because he is partner for lesser profit share.

Amitabh is comect because Goodwill is shared by the partners in their sacrificing ratlo. Since
sacrificing ratio or the new profit-sharing ratio is not given, both have sacrificed In ther
profit-sharing ratio.

Both are correct because fim's Goodwill is because by their joint efforts
which ourmal entry/entries will be passed for the accounting of Goodwill?
Bank AVe Dr. 5,60,000
To Charu's Capital AVc 5.00,000
To Premium for Goodwill Ac 60,000

Premium for Goodwill A/c Dr. 60,000

To Bachan's Current A/c 60,000
Premium for Goodwill A/c Dr. 60,000
To Amitabh's Current Ac 36,000
To Bachan's Current Alc 24,000
OBoth (a) and (c)

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Multiple Choice Question MCQ69

) Interest that will be paid to Amitsbh on his loan is

25,000. 12,50
30,000 O 15,000.
) Interest that will
be charged from Bachan on his loans
O 2,500.
10,000.
5000. NiL
2. Bimal are partners
Amrit and sharlng profits and losses in the ratio of 3:2. Because
of the uncertain
ncredt period ofsales had increased but the suppliers had decresed the credit perlod.Asaresut
orking capitalrequirement had increased. They decided to expand the business besides meeting
the working capital shortage by admitting Lalit as partner for 1/4th share. Lalit took 1/5th of his share from
Amit and balance from Bimal. Lalit's share of goodwills valued at 90000.
At the time f Lalit's admission as partner, the assets are revalued and liabilities are reassessed as follows:

Book Value (t) Assessed Value ()

Building 25,00,000 27,00,000
Land
10,00,000 50,00,000
Computers 2,00,000 50,000
Workmen Compensation Claim 2,50,000
Customer Claim
1,00,000
Goodwill exlsted in the books at 2,00,000 and General Reserve at 5,0,000.
Answer the following questlons based on the above information by choosing the correct option.
9 Sacrificlng Ratlo of Amrit and Bimal is

1:4 4:1
3:2.
2 3.
() New Profit-sharling Ratio of the partners will be

6:5:9. 5:6:9.
11:4:5 9:6:5.
(i) Goodill brought by Lalit will be distributed between Amrt and Bimal as

O 30,00 and 60,000 respectively.

O 45,000 and ? 45,000 respectively.
72.000 and 18,000 respectlvely.
18,000 and t 72,000 respectlvely.
(v) Share of Revaluatlon profit of Amrit and Bimal is
22,00,000 and 15,00,000 respectively.20,00,000 and 17,00,000 respectively.
22,20,000 and 14,80,000 respectvely. 14,80,000 and 22,20,000 respectlvely.
Goodwill existing in the books and balance In General Reserve wll be accounted as follows:
Goodwll of 2,00,000 will be debited to Capital Accounts of Amrit and Bimal In the ratio of
3:2 whlle General Reserve of t 5,00,00 will be credited to the Capital Accounts In the
Same ratlo
Goodwill of F2.00,000 wll be credited to Capital Accounts of Amrit and Bimal in the ratio
of 3:2 whlle General Reserve of 5,00,000 wil be debited to the Capltal Accounts in the
same ratlo.
Goodwll of t 2,00,000 and General Reserve of 5.00,000 wll be credited to the Capital
Accounts of Amrit and Bimal In the ratlo of 3:2.
Goodwll of 2,00,000 and General Reserve of 5,00,000 will be deblted to the Capital
Accounts of Amrit and Bimal in the ratio of 3: 2.

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MCQ.70 An Aid to Accountancy-CBSE XII

3. LUsa and Monika are partners in a firm sharing profits and losses in the ratlo of 5:3. They are into

High Fashion Clothing for teens. The business requires bringing styles in clothing frequently. They had
new
employed anextremely talented Fashion Designer Noor.Afterdiscussionswith Noo, they madehera partner
on 1st April, 2020 for 1/4th share in profits with minimum guaranteed profit of 6,00,000. She was to bring
50,000 only as Capital. She was unable to bring her share of Goodwill and It was agreed that her share
of goodwill will be adjusted from her share of profits in 4 equal instalments. Profit for the year ended
31st March, 2021 was 19,20,000.For the purpose of admission of Noor, Goodwill ofthe frm is to be valued
at 4 years purchase of the average super profits of the last 3 years. Average profit of the last 3 years ls
20,00,000. Normal Profit is 12,00,000. Assets were revalued and liabilities were reassessed as follows:

Book Value ( Assessed Value ()

Furniture 2,00,000 1,50,000
Computers 3,00,000 2,00,000
Stock of Cloth S,00,000 4,60,000

Creditors 75,000 65,000

On the basis of above information, choose the correct option to the questions
(0 New Proftsharing Ratio Is
2:1:1 3:3:2
4:3:1 15:9:8
( Value of firm's Goodwill s
3,00,000. 32.00.000.
O 3,40.000. 3.60,.000.
i) For Adjustments of goodwll the entry wil be:
Noor's Capital A/c .D. 80,000
To LIsa's Capital A/c 80,000
Noor's Capital AVc .Dr. 80,000
To Lisa's Capltal A/c 50,000
To Monica's Capital A/e 30,000
Noor's Capital A/c Dr. 60,000
To Lisa's Capital AVc 30,000
To Monica's Capital A/c 30,000

Noor's Capital A/c Dr. 80,000

To Lisa's Capital A/c 30,000
To Monica's Capltal A/c 50,000
() Revaluation Loss is
O 210,000. 1,90.000
O 1,80,0. 220,000.
Deficiency in minlmum guaranteed profit to Noor will be bome by Lsa and Manica as

45,000 and 75,000 respectively. 75,000 and 45,000 respectively.

O 50,000 and 80,000 respectively. 5,000 and 33,000 respectively.

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Multiple Choice Questions
MCQ.71
4. Amar and Bhaskar
recently retired as teachers from a school where they were teaching Accountancy and
Business Studies
respectively. Having taught for over 30 years, they were fully conversant with
thelr respective subject. Thelr frlends advised them not to retire from
teaching profession since they had
nuances or
such a rich experience. Both had excellent
started teaching as a
teaching experlence besides having good understanding. They
passlon after retirement and recelved good response. During the Lockdown
they switched to online
teaching. Encouraged by the response to thelr online in 2020
YouTube Channel of their own in the name of"G. ACADEMY. A partnershipteaching, they
have a decided to
It reglstered to teach thelr firm was formed and got
respecthive subjects. They were to share profits In the ratio of S:4. In the initial
period the vlewership
was less but
gradually Increased to a good number.
They recelved feedbacks from students and parents for that
the demand, Economics subject be also taught. Looking at
they admitted their Ex-Colleague and a well experlenced
share in the teacher, Ravi as a partner for 1/5th
profits. Amar and Bhaskar decided to share profits equally in future. Ravl
2,00,000 as capital and t 72,000 as his share brought in cash
the books at 45,000. of goodwill. At the time of admission Goodwill existed in

Based on the above information choose the correct

option to the following questions
0) The correct Journal entry for Capital and Goodwill will be:
Cash AVe
To Ravl's Capital A/c
Dr. 2,72,000
To Premlum for Goodwill A/c
2,00,000
72,000
Revaluatlon
To Ravl's
A/c 2,72,000
Capital A/c
To Premlum for Goodwill A/c 2,00,000
72,000
Bank To Ae
Ravi's Current A/c
Dr. 2,72,000
To Premium for Goodwill A/c 2,00,000
72,000
Revaluatlon A/c
To Rav's Current A/c
.Dr. 2,72,000
To Premium for Goodwill A/c 2,00,000
() New
72,000
profit-sharing ratio of Amar, Bhaskar and Ravl will be
1:1:1. 5:4:1.
O 2:2:1. 5:4:5.
(in Sacrificing Ratio of Amar and Bhaskar is

1:1 7:2
5:4. None of these.
(v) Joumal entry for accounting of Goodwill existing in the books will be
Amar's Capital Ac D.
5,000
To Bhaskar's Capital A/c
5,000
O Goodwill A/c Dr. 45,000
Amars Capital A/c
To Bhaskar's Capltal Nc 25,000
20,000
Amars Capital A/c Dr.
3,000
Bhaskar's Capital A/c .Dr 2 2,000
To Ravi's Capltal A/c
5,000
Amar's Capital A/c 25,000
Bhaskar's Capital A/c Dr 20,000
To Goodwill A/c
45,000

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MCQ.72 An Aid to Accountancy-CBSE XIU

( Premium for Goodwill brought by Ravi will be credited to Capital Accounts of Amar and Bhaskar
as follows:

56,000 and 16,000. 16,000 and 56,000.

36,000 each. 48.000 and 24,000.

5. The Holiday Club has aangements with manry resorts across India whereby the The
members of Holiday
portal the
Club can enjoy the facilites of the resorts after making
reservations through the centralised of
club. All these facilities are through the portal and minimum of human touch taking all the precautions
of pandemic it is a partnership fim with Samaira, Anahat and Nimrat as partners and capitals invested
ofF 5.00,000,7 S.00,000 and 8,00,000 respectively sharing profits in the ratio of 5:5:8&.They are mainly
based in South India and are now looking to expanding their businessto North India initially and gradually
to East, West and Central India. They had decided to introduce adequate capital so that thelr respective
capitals are double the present capital. Capitals were brought in by Samaira and Anahat as were required
but Nimrat could bring 4,0o,000 against her share of 8,00,000. It was agreed, that to cover the shortfallin
capital, new partner should be admitted who would bring in the amount that Nimrat could not bring and
that the new partner would get share of profts equal to 1/4th of Nimrat's share which would be sacrificed
byher alone Thus, Gurbaz was admitted and he brought in the requlred capital and 2,00,000 as Premium
for Goodwill
Based on the above Informatlon, choose the correct option to the following questlons.
(0 New Profit-sharing Ratio ofSamaira, Anahat, Nimrat and Gurbazs
1:1:1:1. 5:5:8:8.
5:5:6:2. O5:5:8:4.
(0) The amount of capital brought in by the new partner Gurbaz is

450,00.
2,00,000.
4,00,000. 8,00,000
(li) Value of the Goodwill of the firm is

2,00,000. 4,00,000.
O8,00,000. O 18,00,000.
() The correct journal entry for distribution of Premium for Goodwill
brought by Gurbaz Is
Gurbaz's Capital A/c Dr. 4.00,000
To Nimrat's Capital A/c
7 4,00,000
Premium for Goodwill ANe Dr. T 2,00,000
To Nimrat's Capital A/e
2,00,000
OPremium for Goodwill AWe Dr. 18,00,000
To Samaira's Capital A/e
5,00,000
To Anahat's Capital A/e
5,00,000
To Nimrat's Capital A/c
8,00,000
Premiumfor GoodwillWe .Dr. 8,00,000
To Samaira's Capital A/c
2,00,000
To Anahat's Capital A/c
2,00,000
To Nimrat's Capital A/c
4.00,000

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Multiple Choice Questions MCQ.73

ANSWERS

(Multiple Choice Questions (MCQs))

1. 2. (b) 3. a) d)
4
5. 5.(6) 7. a) 6)
9. (a)

Let the total share = 1,2s Proft Share =2/10, Remaining Proft Share=1

Xs New Proft Share=8/10x 3/5 =24/50; Ys New Profit Share =8/10x 2/5 = 16/50;73 Proft Share =2/10
or 10/50
New Profit-sharing Ratlo of X, Yand Z= 24/50:16/50: 10/50 or 12:8:5.

10.
New Profit Share of old partner = Old Profit Share- Profit Share sacificed in favor of new partner

ShwsNewProftShare -
Mohan's New Profit Share -4
104040
New Profit-sharing Ratio of Sh, Mohan and Jia = 17/40:11/40:3/10 or 17:11:12
11. 12. (b) 13. (0 ), () (a) 14.
5. b 16. b) 17. (d) 18. (b)

19. (b)
Share sacrificed O l d profit share - New profit share

MSacnfce-- 16
NsSacrifice
Sacrificlng ratio of Mand N=3/16:1/16 or 3:1.
20.

Niyat's sacrifice = 4/7x 1/4= 1/7

Aisha's sacrlfice 3/7x 1/n= 3/49

Profit Share of Bina 2=
21. (C) 22..(a) 23. (a) 24. (c)

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 MCO.74 An Aid to Accountancy-CBSE XII
25. (a)
New Profit Share =
Old Profit Share-Sacrificed Share
Anita's New Profit Share 45-441
60 60
Babita's New Profit Share
60
Savita's Profit Share = 1/5

New Profit-sharing Rato

or41:7:12.
26. b)
Total assets brought by Moon {2,00,000+ 1,20,000+80,000+7 50,00074,50,000

Moon's share (2/8) of Goodwill Total of Assets-His Share of Capital

= 4,50,000-73,80,000=T70,000

Value offirms Goodwill =

70,000 x 8/2 -72,80,000.
27. 28. 29(a)

30. 6) XsSacrifice =3/4-2/4 1/4;Y's Sactifice= 1/4-1/4 0.

As only Xhas sacrificed, he will be entiled to the entire share of premium for goocwill brought in by 2.

31.

(00) (b)

Value
ofFims Goodwill 20,000-12,000)x 4 =T 32000
N's Share
of Goodwill R32,000 x 1/4=R8,000
N's Share of Goodwill is credited to Land Min their sacrificing ratlo, l.e, 5:3.

32. 33. 34. (b)

35. (b) Total Capital of firm the basis of R'$

on Capital =
T20,000 x3/1 =760,000
Value of Hidden Goodwill =
Total Capital-Existing Capital (ncluding R's
capltal)
= R60,000-R15,000+15,000+ 20.000)=710,000.

36.

37.

Workng Note
Capital of the fim on the basis of Zs share =
14,000 x =70,000
Existing Capital of the firm
=R 18,000+S,000 (Share
of Profit]+ [ 12,000+5,000 (Share of Profit)+R14,000)= 54,000
Hidden Goodwill =R 70,000-7 54,000=T 16,000.

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Multiple Choice Questios
MCQ.75
38. (d Value of Goodwill ={9,000 x6/1
=754000
39. t

(Assertion-Reason Based Questions

(b) 2 3.
5.
7. () 8 (a)
9. (a) 10. 11. (a b
13.(b) 14. 15..b) 16. (d
17.. ( 18 (b) 19.(b) 20. 6)
21..(d) 22. (6) 23..6) 24

25. (b)

Case Study Based Questions

1. c.G) (d), Gin (b), () (d)
2. (a)
Amit's sacrifice of profit share = 1/4x 1/5 = 1/20
Bimal's sacrifice of profit share =
1/4-1/20=4/20
Sacrificing Ratio is 1:4.
c
New Profit-sharing Ratio
Amrit

Bimal

Lalit 1/4 5/20. New

or
Profit-sharing Ratio 11:4:5.

3. 0 (d)

(6)
Super Profit = Average Profit-Normal Proft
= 20,00,000- 12,00.000=R800,.000.

Goodwill Super Profit x 4

= 8,00,000 x4=732,00,000.

(li) (b), (iv) (c, (M (b)

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MCQ.76 An Ald to Accountancy-CBSE XII

4. (a)

Worklng Notes
Ravi's share in Profits 1/5
Remaining Profit Share = 1-1/5-4/5
Amars New Profit Share= 4/5 x 1/2-4/10
Bhaskar's New Profit share= 4/5x
1/2= 4/10
Ravi's Profit Share 1/5x 2/2=2/10
Therefore, New Profit-sharing Ratio = 4:4:2or2:2:1.
b)
Worklng Notes: .
Sacrificing Ratio New Profit Share Old Profit Share
Amar 5/9-2/5 7/45
Bhaskar = 4/9-2/5=245

Le, 7:2.

v) d)
Existing Goodwill is written off among old partners by debiting thelr Capltal Accounts In thelr
old Profit-sharing Ratlo.

(a)

5. ) C)
Working Note:
Old Profit-sharlng Ratlo 5:5:8
Gurbar's Profit Share = 8/18 x 1/4= 8/72
Nimrats New Profit Share = 8&/18-8/72 24/72
New Proft Sharing Ratto 5:5:6:2, cokulated as follows*
Samalra's Proft Share 5/18x 4/4 = 20/72
Anahat's Proft Share 5/18 x 4/4 20/72
Nimrat's Proft Share 24/72
Gurbaz's Proft Share = 8/72.

Gurbar's Capltal = Nimrats Required Capital - Capital brought by Nimrat

- 8,00,0074/00,000- 4,00.000.

Working Note: Goodwill of the Firm= 18/2xt 2,00,000- 18.00.000.

(b)
Since only Nimat has sacnificed her profit, therefore, premium brought by Gurbaz wil be credited to
her Capital Account.

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