Reconstitution of a Partnership Firm – Admission of a Partner

Investment Fluctuation Reserve stands at ₹10,000. Book value of investment is ₹1,00,000 and its market value on the date of admission is ₹94,000. What amount of Investment Fluctuation Reserve will be distributed to old partners?

1. ₹10,000
2. ₹6,000
3. ₹4,000
4. Nil

In the absence of any specific agreement, in what ratio do old partners sacrifice their profit share upon the admission of a new partner?

1. Equal ratio
2. New profit-sharing ratio
3. Old profit-sharing ratio
4. Capital ratio

If a partner's capital is to be adjusted on the basis of the new partner's capital, and Partner A's present adjusted capital is ₹1,20,000 while his required capital is ₹1,50,000, what action should A take?

1. Withdraw ₹30,000 in cash
2. Bring in ₹30,000 additional cash
3. Transfer ₹30,000 to Revaluation Account
4. No cash transaction is required

Workmen Compensation Reserve appears in the balance sheet at ₹40,000. On admission of a new partner, a liability for workmen compensation is estimated at ₹15,000. How much amount will be credited to Old Partners' Capital Accounts?

1. ₹40,000
2. ₹15,000
3. ₹25,000
4. Nil

If the new partner is unable to bring his share of premium for goodwill in cash, which account is debited to adjust the goodwill amount?

1. Goodwill Account
2. Cash/Bank Account
3. New Partner's Current Account
4. Old Partners' Capital Accounts

A and B are partners sharing profits in the ratio of 2:1. Revaluation of assets and liabilities resulted in a net loss of ₹18,000. How will this loss be distributed on C's admission?

1. Debited to A's Capital A/c ₹12,000 and B's Capital A/c ₹6,000
2. Credited to A's Capital A/c ₹12,000 and B's Capital A/c ₹6,000
3. Debited to A, B, and C equally (₹6,000 each)
4. Debited to A's Capital A/c ₹9,000 and B's Capital A/c ₹9,000

Accumulated profits and general reserves existing in the balance sheet on the date of admission are transferred to:

1. All Partners' Capital Accounts in new profit-sharing ratio
2. Old Partners' Capital Accounts in old profit-sharing ratio
3. Old Partners' Capital Accounts in sacrificing ratio
4. Revaluation Account

At the time of admission of a partner, how is an unrecorded asset treated?

1. Debited to Revaluation Account
2. Credited to Revaluation Account
3. Credited to Old Partners' Capital Accounts directly
4. Debited to New Partner's Capital Account

What is the nature of the Revaluation Account prepared at the time of admission of a new partner?

1. Personal Account
2. Real Account
3. Nominal Account
4. Representative Personal Account

If goodwill already appears in the balance sheet at the time of admission of a new partner, how is it treated in the books of accounts according to Accounting Standard 26 (AS-26)?

1. Retained in the balance sheet at its existing value.
2. Written off by debiting Old Partners' Capital Accounts in old profit-sharing ratio.
3. Credited to Revaluation Account.
4. Debited to All Partners' Capital Accounts in new profit-sharing ratio.

A and B are partners with capitals of ₹1,00,000 and ₹80,000 respectively. C is admitted for a 1/4th share in profits and brings ₹70,000 as his capital. What is the total value of hidden goodwill of the firm?

1. ₹30,000
2. ₹50,000
3. ₹10,000
4. ₹40,000

When a new partner brings in his share of goodwill in cash, which account is credited for distributing this premium among sacrificing partners?

1. Realisation Account
2. Premium for Goodwill Account
3. Sacrificing Partners' Capital Accounts
4. Profit and Loss Appropriation Account

P and Q are partners sharing profits in the ratio of 3:2. R is admitted for a 1/5th share, which he acquires entirely from P. What is the new profit-sharing ratio of P, Q, and R?

1. 2:2:1
2. 8:6:3
3. 11:10:4
4. 2:1:1

X and Y are partners sharing profits in the ratio of 7:3. Z is admitted, and X sacrifices 2/7th of his share while Y sacrifices 1/3rd of his share in favour of Z. What is the sacrificing ratio of X and Y?

1. 2:1
2. 7:3
3. 2:3
4. 1:1

A and B are partners sharing profits and losses in the ratio of 3:2. They admit C as a new partner for a 1/4th share in the profits. What will be the new profit-sharing ratio of A, B, and C?

1. 9:6:5
2. 3:2:1
3. 9:6:4
4. 12:8:5