Test: Reconstitution of a Partnership Firm: Admission of a Partner- Assertion & Reason Type Questions - Commerce MCQ

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): Whenever a new partner brings goodwill in cash, he should bring the amount of goodwill, only for his share.

Reason (R): It is a common rule that the gaining partner should compensate the sacrificing partner to the extent of his gain.

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): At the time of admission of a partner if there is any General Reserve, Reserve Fund or the balance of Profit & Loss Account appearing in the balance sheet, it should be transferred to old partners’ capital/current accounts in their old profit sharing ratio.

Reason (R): The General reserve, Reserve Fund or the Balance of Profit and Loss Account are the result of the past profits when the new partner was not admitted.

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): Profit or loss on revaluation of assets and reassessment of liabilities is transferred to the old partners' capital/current accounts in old profit sharing ratio.

Reason (R): All the accumulated profit or loss and reserves are transferred to the old partners' capital/ current accounts in the old profit sharing ratio.

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): A new partner can be admitted into a partnership firm with the consent of all the existing partners.

Reason (R): According to Section 31 of the Indian Partnership Act, 1932, a new partner shall not be introduced into a firm without the consent of all the existing partners, unless it is agreed otherwise by the partners in the partnership deed.

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): New Profit Sharing Ratio is the ratio in which old partners including the new partner, share the profits or losses of the firm.

Reason (R): When a new partner is admitted to the firm it is necessary to calculate the new profit sharing ratio with the help of the share agreed to forgo by the old partners.

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): If goodwill is already appearing in the book, old goodwill should always be written off among old partners in the old ratio.

Reason (R): The amount of goodwill should be adjusted through partners’ capital/current accounts.

Directions : In the following questions, a statement of Assertion (A) is followed by a statement of Reason (R). Mark the correct choice as:

Assertion (A): On admission of a new partner, Assets and liabilities are revalued.

Reason (R): Assets and liabilities are revalued so as to show the proper financial position of the firm and the capital held by the partners at the time of admission.