Gujarat Board GSEB Class 12 Commerce Accounts Important Questions Part 1 Chapter 5 Admission of a Partner Important Questions and Answers.

GSEB Class 12 Accounts Important Questions Part 1 Chapter 5 Admission of a Partner

Answer the following questions in short :

Question 1.
Why does new partner has to bring capital ?
Answer:
To get the profit sharing right in the firm, new partner brings the capital in the firm.

Question 2.
What is it called when the new partner brings more cash over and above the capital, which is distributed among old partners in their sacrifice ratio ?
Answer:
To compensate the sacrifice of old partners, money received by old partners from new partner is known as premium.

GSEB Class 12 Accounts Important Questions Part 1 Chapter 5 Admission of a Partner

Question 3.
What is goodwill premium ?
Answer:
When a new partner is admitted, old partners sacrifice some part of profit in favour of new partner. The compensation paid in cash by new partner for this sacrifice of old partner is known as goodwill premium.

Question 4.
According to accounting standard 26, when should the amount of goodwill not shown in books of accounts ?
Answer:
According to accounting standard 26, when the firm has made internally generated goodwill, it should not be shown in accounts of the firm.

Question 5.
According to accounting standard 26, when should the amount of goodwill be shown in the books of accounts of the firm ?
Answer:
According to accounting standard 26 when any amount is paid against goodwill then it can be shown in accounts of the firm.

Question 6.
While admitting new partner, how will the goodwill amount shown in old balance sheet of the firm reflected ?
Answer:
While admitting new partner, the goodwill of old balance sheet is distributed among old partners in their old profit sharing ratio.

Question 7.
What would be the accounting effect, if the new partner gives amount of goodwill to old partner in cash outside the business ?
Answer:
There will be no accounting effect in the books of the firm if the new partner pays goodwill amount in cash to old partners outside the business.

Question 8.
Give the accounting effect, when new partner brings the amount of goodwill in cash ?
Answer:
The accounting effect goodwill when new partners brings it in cash is
GSEB Class 12 Accounts Important Questions Part 1 Chapter 5 Admission of a Partner 1

GSEB Class 12 Accounts Important Questions Part 1 Chapter 5 Admission of a Partner

Question 9.
Give the accounting effect, when new partner does not bring the amount of goodwill in cash ?
Answer:
When new partner does not bring the amount of goodwill premium in cash, then the journal entry is.
GSEB Class 12 Accounts Important Questions Part 1 Chapter 5 Admission of a Partner 2

Question 10.
In which ratio the goodwill premium is distributed among the old partners ?
Answer:
The goodwill premium is distributed among old partners in their sacrificing ratio.

Question 11.
Where is the amount of profit or loss shown arising out of change in values of assets and liabilities
on admission of a new partner ?
Answer:
The amount of profit or loss arising out of change in values of assets and liabilities on admission of an new partners is shown in capital account of old partners in their old profit sharing ratio.

Question 12.
When memorandum revaluation account is prepared ?
Answer:
At the time of admission of a new partner when firm decides to show the assets and liabilities at old value in the books of new firm then to record the changes in value of assets and liabilities memorandum revaluation account is prepared.

Select the appropriate option for each questions :

Question 1.
How can a new partner be admitted in the existing partnership firm ?
(A) The existing partnership can take decision of admitting new partner with majority.
(B) If there is a provision in the partnership deed then abiding by it.
(C) If there is no partnership deed, then by following Partnership Act 1932.
(D) By taking permission of partners who are managing the firm.
Answer:
(B) If there is a provision in the partnership deed then abiding by it.

GSEB Class 12 Accounts Important Questions Part 1 Chapter 5 Admission of a Partner

Question 2.
While admitting new partner, where are preliminary expense and advertisment suspense account shown ?
(A) Revaluation Account
(B) Capital account of new partner
(C) Capital account of old partner
(D) Profit and Loss account
Answer:
(C) Capital account of old partner

Question 3.
While admitting new partner where is the amount of general reserve shown ?
(A) Revaluation Account
(B) Capital account of old partner
(C) Capital account of new partner
(D) Capital account of new and old partners
Answer:
(B) Capital account of old partner

Question 4.
What is worker profit sharing fund for the firm ?
(A) Asset
(B) Income
(C) Debt
(D) Expense
Answer:
(C) Debt

Question 5.
Where is workers profit sharing fund shown after the admission of new partner ?
(A) Revaluation Account
(B) Partners capital account
(C) On liabilities side of Balance Sheet
(D) On Assets side of Balance Sheet.
Answer:
(C) On liabilities side of Balance Sheet

Question 6.
Where would the amount of bad debts reserve be shown while admitting a new partner ?
(A) Debit side of Revaluation account
(B) Liabilities side of Balance Sheet
(C) Credit side of Revaluation Account
(D) Debit side of current or capital account of partners.
Answer:
(A) Debit side of Revaluation account

Question 7.
After admission of new partner, profit of the firm will be distributed in which ratio ?
(A) Old ratio
(B) Ratio of capital
(C) New ratio
(D) Equally
Answer:
(C) New ratio

GSEB Class 12 Accounts Important Questions Part 1 Chapter 5 Admission of a Partner

Question 8.
The balance of revaluation account is transferred to which account ?
(A) Profit and loss account
(B) Current/capital account of partners
(C) Profit and loss appropriation account
(D) Liabilities side of Balance Sheet
Answer:
(B) Current/capital account of partners

Question 9.
What is the sacrifice of old partners in favour of new partner known as ?
(A) Income
(B) Expenditure
(C) Premium
(D) Profit
Answer:
(C) Premium

Question 10.
How is ‘Goodwill’ shown in Balance Sheet distributed among partners on admission of a new partner ?
(A) Equally among all the partners
(B) Among all partners in new ratio
(C) Among old partners in their old ratio
(D) Among old partners in their sacrifice ratio.
Answer:
(C) Among old partners in their old ratio

Question 11.
If the new admitted partner bring the amount of goodwill in cash, then that is distributed among old partners in which ratio ?
(A) Equally
(B) New ratio of profit sharing
(C) Old ratio of profit sharing
(D) Sacrifice Ratio
Answer:
(D) Sacrifice Ratio

Question 12.
‘A’ and ‘B’ are partners of a firm sharing profit and loss in the ratio of 3 : 2. They decided to admit
‘C’ as a new partner with \(\frac {1}{5}\) share. What would be the new profit sharing ratio of the firm ?
(A) 12 : 8 : 5
(B) 8 : 12 : 5
(C) 12 : 5 : 8
(D) 8 : 5 : 12
Answer:
(A) 12 : 8 : 5

Question 13.
Amar and Akbar are partners having equal profit sharing ratio. They decided to admit Anthony as
a new partner with \(\frac {1}{4}\) share in profit. Calculate the new profit sharing ratio of partners.
(A) 2 : 3 : 3
(B) 3 : 3 : 1
(C) 3 : 3 : 2
(D) 1 : 1 : 1
Answer:
(C) 3 : 3 : 2

GSEB Class 12 Accounts Important Questions Part 1 Chapter 5 Admission of a Partner

Question 14.
Priyam and Devam are partners sharing profit and loss in the ratio of 3 : 5. They have admitted Shivam as a new partner in their firm. The new profit sharing ratio is 3 : 2 : 1. Calculate the sacrifice ratio of Priyam and Devam.
(A) 5 : 7
(B) 3 : 2
(C) 7 : 5
(D) 2 : 3
Answer:
(A) 5 : 7

Question 15.
Rajan and Sajan are equal profit sharing partners of a firm. They have admited Kajal with \(\frac {1}{5}\) share as a new partner of the firm. Calculate the sacrifice ratio of Rajan and Sajan.
(A) 1 : 4
(B) 4 : 1
(C) 1 : 1
(D) 2 : 1
Answer:
(C) 1 : 1

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