Admission of a Partner Test

Result

Admission of a Partner Test - 52

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Weekly Quiz Competition

Question 1
1 / -0

From the following information calculate the value of goodwill.
The adjusted maintainable profit is Rs 40,000, Capital employed is Rs 2,00,000, Normal rate of return is $$15\%$$, Capitalization rate is $$20\%$$.

A
Rs 50,000

B
Rs 75,000

C
Rs 40,000

D
Rs 60,000

Solution
Question 2
1 / -0

A & B are sharing profits & losses in the ratio of 3:2. C is coming as a new partner who pays Rs 25,000 as premium for goodwill. The profit sharing ratio among A, B & C is equal. If premium money is retained in business which of the following journal entry is correct for sharing premium for goodwill?

A

B

C

D
Question 3
1 / -0

P&Q are partners sharing Profits in the ratio of 2:1. R is admitted to the partnership with effect from 1st April on the term that he will bring Rs 20,000 as his capital for 1/4th share and pay Rs 9,000 for goodwill, half of which is to be withdrawn by P & Q. How much cash can P&Q withdraw from the firm?

A
3,000:1,500

B
6,000:3,000

C
NIL

D
None of the above

Solution
Question 4
1 / -0

A, B & C are partners sharing profits and loss in the ratio 3:2:1. They decide to change their profit sharing ratio to 2:2:1. To give effect to this new profit sharing ratio, they decide to value the goodwill at Rs 30,000. Pass the necessary journal entry if Goodwill is not appearing in the old balance sheet and should not appear in the new balance sheet.

A

B

C

D

Solution
Question 5
1 / -0

H & M are partners in a firm sharing profits and losses in the ratio of 3:2. Their capitals are Rs 2,00,000 and Rs 1,50,000 respectively. They admit K as a new partner who will get 1/6th share in the profits of the firm. K brings in Rs 1,00,000 as his capital. It was agreed that goodwill has to be adjusted through partner's capital account. Required journal entry -

A

B

C

D

Solution
Question 6
1 / -0

A & B are partners sharing profits and losses in the ratio of 3:2. C joins the firm for 1/3rd share, and is to pay Rs 40,000 as premium for goodwill but cannot pay anything. Goodwill already appearing in balance sheet is 1,00,000. Required journal entry -

A

B

C

D

Solution
Question 7
1 / -0

A, B & C were equal partners with goodwill Rs 1,20,000 in the balance sheet and they agreed to take D as an equal partner on the term that he should bring Rs 1,60,000 as his capital and goodwill, his share of goodwill was evaluated at Rs 60,000 and the goodwill account is to be written off before admission. What will be the treatment for goodwill?

A
Write off the goodwill of Rs 1,20,000 in old ratio.

B
Cash brought in by D for goodwill will be distributed among old partners in sacrificing ratio.

C
Both (A) & (B)

D
None of the above

Solution

In case when a new partner is admitted in the firm, goodwill already appears in the balance sheet is written off among the old partners in their old profit sharing ratio and the goodwill brought by the new partner will be credited to the sacrificing partners in their sacrificing ratio.
Therefore, C is the correct option.
Question 8
1 / -0

A, B & C are in partnership sharing profits and losses in the ratio 2:2:1. They want to admit D into partnership with 1/5 share. D brings in Rs 30,000 as capital and Rs 10,000 as premium for goodwill. If premium money is retained in business which of the following journal entry is correct for sharing premium for goodwill?

A

B

C

D
Question 9
1 / -0

X & Y share profits and losses as 1:2. They agree to admit Z (Who is also in business on his own) as a third partner.
At the time of admission of Z goodwill was appearing in balance sheet at Rs 14,000 which was revalued at Rs 18,000. Z brings the following assets into partnership:
Goodwill - Rs 6,000 Furniture - Rs 2,800 Stock - Rs 13,600
After admission of Z, goodwill appear at ............... in the balance sheet.

A
Rs 14,000

B
Rs 18,000

C
Rs 24,000

D
Rs 26,000
Question 10
1 / -0

H & M are partners in a firm sharing profits and losses in the ratio of 2:5. They admit K as a new partner who will get 1/6th share in the profits of the firm. Calculate new profit sharing ratio among H, M & K.

A
10:25:7

B
7:25:10

C
25:10:7

D
10:7:25