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Admission of a Partner Test - 55

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Admission of a Partner Test - 55
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Weekly Quiz Competition
  • Question 1
    1 / -0
    X and Y partners sharing profits in the ratio of 3: 1. They admit Z as a partner who pays Rs.8,000 as Goodwill the new profit sharing ratio being 2: 1: 1 among X, Y and Z respectively. The amount of goodwill is credited to ____.  
    Solution

  • Question 2
    1 / -0
    A and B are partners with the capital Rs. 1,00,000 and Rs. 80,000 respectively. They share profits and losses equally. C is admitted on bringing Rs. 50,000 as capital only and nothing was bought against goodwill. Goodwill in Balance sheet of Rs. 40,000 is revalued as Rs. 70,000. What will be value of goodwill in the books after the admission of C?
    Solution
    Value of goodwill in the books after the admission of C= Rs 70000. Because the goodwill has been revalued before the admission of C.
  • Question 3
    1 / -0
    Unless provided otherwise, it is presumed that __________. 
    Solution

    When the share of new or incoming partner is giving without giving the details of the sacrifice made by the old or existing partners, it is assumed the old partners will sacrifice in their old profit sharing ratio and that: 

    1. sacrificing ratio will always be the old profit sharing ratio, and 

    2. the new profit sharing ratio between old partners will be same as the old profit sharing ratio.

  • Question 4
    1 / -0
    X and Y are partners in a partnership firm sharing profits in the ratio of 5:3 respectively. Z was admitted on the following terms: Z would pay Rs.1,00,000 as capital and Rs. 32,000 as Goodwill, for a 1/5th share of profit. Machinery would be appreciated by 10% (book value Rs. 1,60,000), and the building is depreciated by 20% (Rs.4,00,000). Unrecorded debtors are of Rs. 2,500 would be bought into books note, and creditors are amounting to Rs. 5,500 died and need not pay anything tolls estate. Find the distribution of profit/loss on revaluation between X, Y and Z? 
  • Question 5
    1 / -0
    X and Y shared profit and losses in the ratio of 3:2. With effect from 1st April they agreed to share profits equally. The goodwill of the firm was valued at Rs 30,000. The necessary single adjusting entry will involve.
    Solution
    Earlier Goodwill was shared among X and Y in ratio 3:2
     i.e. 30000*3/5=18000
    •        30000*2/5=12000 
    • With effect from 1st April, goodwill is to be shared equally 
    30000*1/2= Rs.15000 each.
    X = 18000-3000=15000
    Y= 12000+3000=15000
    Hence, Y's A/c will be credited by 3000 and X's A/c will be debited.





  • Question 6
    1 / -0
    A and B are in partnership with Rs.30,000 and Rs. 20,000 as their respective Capitals. They admitted C as a partner for 1/6th share in profits. The amount of C's share In the Capital of the firm if he is asked to bring in Capital in proportion to his profit sharing ratio will be ________. 
    Solution
    To calculate the amount of capital contributed by C , 
    1 - 1/6 = 5/6
    5/6 is the share of A and B.
    So, 
    30000 + 20000 = 50000 (capital of A and B) 
    Total capital of the firm = 50000* 6/5 = 60000
    C's capital = 60000*1/6 = Rs 10000
  • Question 7
    1 / -0
    A and B shares profit and losses equally. They admitted C as equal partner and assets were revalued as follows: Goodwill at Rs.60,000 (book value NIL). Stock at Rs. 40,000 (book valuer Rs. 24,000); Machinery at Rs. 1,20,000 (book value Rs. 1,10,000). C is to bring in Rs. 40,000 as his capital and the necessary cash towards his share of Goodwill. Goodwill Account will not remain in the books. Find the profit/Loss on revaluation to be shared among A, B and C? 
  • Question 8
    1 / -0
    Accumulated profits/losses & reserves are shared by the old partners in their ________.
    Solution
    Profits and losses of previous years which are not distributed to the partners are called accumulated profits and losses. Any reserve and accumulated profits and losses belong to the old partners and hence these should be distributed to the old partners in the old profit sharing ratio.
  • Question 9
    1 / -0
    Profit/Loss on revaluation of assets & liabilities is shared by the old partners in their _______.
    Solution
    A Revaluation Account is prepared in order to ascertain net gain or loss on revaluation of assets and liabilities and bringing unrecorded items into books. The Revaluation profit or loss is transferred to the capital account of all partners including retiring or deceased partners in their old profit sharing ratio.
  • Question 10
    1 / -0
    A, B and C were equal partners of a firm with goodwill Rs. 1,20,000 shown in the balance sheet and they agreed to take D as an equal partner on the term that he should bring Rs. 3,20,000 as his capital and goodwill, his share of goodwill was evaluated at Rs. 1,20,000 and the goodwill account is to be written off before admission. What will be the treatment for goodwill?
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