Retirement or Death of a partner Test

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Retirement or Death of a partner Test - 18

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SHARING IS CARING

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Weekly Quiz Competition

Question 1
1 / -0

General reserve, transferred to partners capital accounts in ___ ratio.

A
new

B
old

C
sacrifice

D
gain
Question 2
1 / -0

A new partner, along with other partners get ____________.

A
right to share future profit of the firm

B
right to share future assets of the firm

C
both (a) and (b)

D
either (a) or (b)
Question 3
1 / -0

A retiring partner is liable for all acts of the firm __________.

A
for all acts of the firm.

B
for all acts of the firm upto the date of his retirement.

C
ceases to liable for all past and present acts.

D
past, present and future acts of the firm

Solution

A retiring partner is liable to acts as all partner before his retirement but after the retirement they do not act as partner and also they do not liable for rights of the partner in the firm.
Question 4
1 / -0

On retirement of a partner, the existing balance of general reserve and accumulated profit is transferred to all the partners capital a/c in the ____________.

A
Gaining ratio

B
Sacrificing ratio

C
Old profit sharing ratio

D
New profit sharing ratio

Solution

At the time of retirement of a partner, if there exist any reserve or accumulated profit in the books of the firm, they should be transferred to the old partner's capital/current accounts in the old profit sharing ratio, because these items belongs to the old partners.
In the same manner, old partner's capital/current accounts should be debited in the old ratio if any accumulated loss appears in the asset side of the balance sheet.
Question 5
1 / -0

On admission of A, a new partner, the value of closing stock was brought down by Rs.6,500. The revaluation a/c will be ______.

A
Debited by Rs. 6000

B
Debited by Rs. 6500

C
Debited by Rs. 650

D
Debited by Rs. 655

Solution

On admission of A new partner,
If there is a decrease in the closing stock by 6500.
Then, the Journal Entry in such case will be
Revaluation a/c Dr. 6500
To Stock a/c 6500
Question 6
1 / -0

To which account is accumulated balances of profit and loss account and general reserve account are transferred at the time of admission of a partner?

A
Partners current capital A/c

B
Partners fixed capital A/c

C
Revaluation A/c

D
Profit and loss adjustment A/c

Solution

Partners current capital A/caccount is accumulated balances of profit and loss account and general reserve account are transferred at the time of admission of a partner. These balances are distributed to the old partners in the old ratio.
Question 7
1 / -0

Interest allowed on the capital of partner is charged to ________.

A
profit and loss A.c

B
profit and loss appropriation A/c

C
profit and loss adjustment

D
revaluation A/c
Question 8
1 / -0

To ascertain profit or loss on retirement / death of a partner _____________ is prepared.

A
realization a/c

B
profit and loss a/c

C
revaluation a/c

D
profit and loss adjustment a/c

Solution

Revaluation a/c is to be prepared for shown or to calculate retirement and death of partners so this separate revaluation a/c is used. profit and loss account is use for the income and gain of all partners.
Question 9
1 / -0

How are unrecorded assets treated at the time of retirements of partners?

A
Debit to Revaluation A/c

B
Credited to Revaluation A/c

C
Credit to partners Capital A/c

D
Credited to capital A/c of retiring partners only

Solution

Any unrecorded assets are credited to revaluation a/c when treatments of retirement of partners.
Question 10
1 / -0

Increase in liability at the time of retirement of a partner is _________.

A
credited to revaluation A/c

B
debited to revaluation A/c

C
debited to profit and loss A/c

D
debited to goodwill A/c

Solution

Revaluation of assets and liabilities is essentially necessary at the time of reconstitution of the partnership be it admission or retirement of partnership. Net profit or loss on revaluation is then distributed among the partners. An increase in liability or decrease in assets will be debited to the revaluation account whereas a decrease in liabilities or increase in assets will be credited to the revaluation account.

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Re-Attempt Weekly Quiz Competition

Retirement or Death of a partner Test - 18

Result

Retirement or Death of a partner Test - 18

Score

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Rank

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SHARING IS CARING

Question 1

new

old

sacrifice

gain

Question 2

right to share future profit of the firm

right to share future assets of the firm

both (a) and (b)

either (a) or (b)

Question 3

for all acts of the firm.

for all acts of the firm upto the date of his retirement.

ceases to liable for all past and present acts.

past, present and future acts of the firm

Solution

Question 4

Gaining ratio

Sacrificing ratio

Old profit sharing ratio

New profit sharing ratio

Solution

Question 5

Debited by Rs. 6000

Debited by Rs. 6500

Debited by Rs. 650

Debited by Rs. 655

Solution

Question 6

Partners current capital A/c

Partners fixed capital A/c

Revaluation A/c

Profit and loss adjustment A/c

Solution

Question 7

profit and loss A.c

profit and loss appropriation A/c

profit and loss adjustment

revaluation A/c

Question 8

realization a/c

profit and loss a/c

revaluation a/c

profit and loss adjustment a/c

Solution

Question 9

Debit to Revaluation A/c

Credited to Revaluation A/c

Credit to partners Capital A/c

Credited to capital A/c of retiring partners only

Solution

Question 10

credited to revaluation A/c

debited to revaluation A/c

debited to profit and loss A/c

debited to goodwill A/c

Solution

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