Retirement (Important Questions) : Accountancy Class 12 PDF Download

 Page 1


Delhi Institute of Commerce and Economics 
1 Delhi Institute of Commerce and Economics 
 
Retirement   
Test 
Time – 50 mins           M.M.- 30 
 
1. A, B and C are the partners sharing profits and losses in the ratio of 5:3:2. C retired and his capital 
balance after adjustments regarding Reserves, Accumulated profits/ losses and gain/loss on revaluation was 
2,50,000. C was paid 3,00,000 in full settlement. Afterwards D was admitted for 1/4th share . Calculate the 
amount of goodwill premium brought by D.         1 
 
2. MM, KK and PP are partners in a firm. PP retired from the firm. After making adjustments for 
Reserves and Revaluation of Assets and Liabilities the balance in PP’s capital account was Rs.1,20,000. MM 
and KK paid Rs.1,80,000 in full settlement to PP. Identify the item for which MM and KK paid Rs.60,000 more 
to PP and pass the entry for the same.         1 
 
3. X, Y and Z are partners in a firm sharing profits in the ratio of 3: 2 : 1. X retires from the firm. Y and Z 
agree that the capital of the new firm shall be fixed at Rs. 2,10,000 in the profit-sharing ratio. The capital 
accounts of Y and Z after all adjustments on the date of retirement showed balances of Rs. 1,45,000 and Rs. 
63,000 respectively. State the amount of actual cash to be brought in or to be paid to the partners. Pass the 
necessary journal entries.           3 
 
4. A, B, C and D were partners sharing profits in the ratio of 3: 3: 2 : 2 respectively. On 1st April, 2014, D 
retired owing to ill health. It was decided by A, Band C that in future their profit-sharing ratio would be 3 : 2 : 
1. Goodwill of the firm is valued at Rs. 6,00,000. Goodwill already appeared in the Balance Sheet at Rs. 
50,000. Pass the necessary journal entries.         3 
 
5. A, B, C and D were partners sharing profits in the ratio of 1:2:3:4. D retired and his share was 
acquired by A and B equally. Goodwill was valued at 3 year’s purchase of average profits of last 4 years, 
which were 40,000. General Reserve showed a balance of 1,30,000 and D’s Capital in the Balance Sheet was 
3,00,000 at the time of D’s retirement. You are required to record necessary Journal entries in the books of 
the firm and prepare D’s capital account on his retirement.       4 
 
6. A, B and C were partners sharing profits in the ratio of 3:5:2.  Their Balance Sheet as on 1
st
 April, 2011 
was as follows: 
Liabilities 
 
Assets 
 
Creditors  
Employees Provident Fund 
Capital A/c’s: 
A 
B 
C 
 
20,000 
26,000 
 
1,00,000 
70,000 
50,000 
Cash  
Debtors  
Stock 
Furniture  
Building  
 
16,000 
16,000 
80,000 
34,000 
1,20,000 
 
2,66,000 2,66,000 
B retires on the above date and it was agreed that: 
a. B’s share of Goodwill was 8,000. 
b. 5% provision for doubtful debts was to be made on debtors.  
c. Sundry creditors were valued 4,000 more than the book value.   
Pass necessary journal entries for the above transactions on B’s retirement.   4 
7. Following is the Balance Sheet of kusum, ghusum and dishum who have agreed to share profits and 
losses in proportion of their capitals. 
Liabilities   Rs  Assets   Rs. 
Capital A/C    Land and Building   4,00,000  
Kusum  4,00,00
0  
 Machinery   6,00,000  
Ghusum  6,00,00
0  
 Closing Stock   2,00,000  
Page 2


Delhi Institute of Commerce and Economics 
1 Delhi Institute of Commerce and Economics 
 
Retirement   
Test 
Time – 50 mins           M.M.- 30 
 
1. A, B and C are the partners sharing profits and losses in the ratio of 5:3:2. C retired and his capital 
balance after adjustments regarding Reserves, Accumulated profits/ losses and gain/loss on revaluation was 
2,50,000. C was paid 3,00,000 in full settlement. Afterwards D was admitted for 1/4th share . Calculate the 
amount of goodwill premium brought by D.         1 
 
2. MM, KK and PP are partners in a firm. PP retired from the firm. After making adjustments for 
Reserves and Revaluation of Assets and Liabilities the balance in PP’s capital account was Rs.1,20,000. MM 
and KK paid Rs.1,80,000 in full settlement to PP. Identify the item for which MM and KK paid Rs.60,000 more 
to PP and pass the entry for the same.         1 
 
3. X, Y and Z are partners in a firm sharing profits in the ratio of 3: 2 : 1. X retires from the firm. Y and Z 
agree that the capital of the new firm shall be fixed at Rs. 2,10,000 in the profit-sharing ratio. The capital 
accounts of Y and Z after all adjustments on the date of retirement showed balances of Rs. 1,45,000 and Rs. 
63,000 respectively. State the amount of actual cash to be brought in or to be paid to the partners. Pass the 
necessary journal entries.           3 
 
4. A, B, C and D were partners sharing profits in the ratio of 3: 3: 2 : 2 respectively. On 1st April, 2014, D 
retired owing to ill health. It was decided by A, Band C that in future their profit-sharing ratio would be 3 : 2 : 
1. Goodwill of the firm is valued at Rs. 6,00,000. Goodwill already appeared in the Balance Sheet at Rs. 
50,000. Pass the necessary journal entries.         3 
 
5. A, B, C and D were partners sharing profits in the ratio of 1:2:3:4. D retired and his share was 
acquired by A and B equally. Goodwill was valued at 3 year’s purchase of average profits of last 4 years, 
which were 40,000. General Reserve showed a balance of 1,30,000 and D’s Capital in the Balance Sheet was 
3,00,000 at the time of D’s retirement. You are required to record necessary Journal entries in the books of 
the firm and prepare D’s capital account on his retirement.       4 
 
6. A, B and C were partners sharing profits in the ratio of 3:5:2.  Their Balance Sheet as on 1
st
 April, 2011 
was as follows: 
Liabilities 
 
Assets 
 
Creditors  
Employees Provident Fund 
Capital A/c’s: 
A 
B 
C 
 
20,000 
26,000 
 
1,00,000 
70,000 
50,000 
Cash  
Debtors  
Stock 
Furniture  
Building  
 
16,000 
16,000 
80,000 
34,000 
1,20,000 
 
2,66,000 2,66,000 
B retires on the above date and it was agreed that: 
a. B’s share of Goodwill was 8,000. 
b. 5% provision for doubtful debts was to be made on debtors.  
c. Sundry creditors were valued 4,000 more than the book value.   
Pass necessary journal entries for the above transactions on B’s retirement.   4 
7. Following is the Balance Sheet of kusum, ghusum and dishum who have agreed to share profits and 
losses in proportion of their capitals. 
Liabilities   Rs  Assets   Rs. 
Capital A/C    Land and Building   4,00,000  
Kusum  4,00,00
0  
 Machinery   6,00,000  
Ghusum  6,00,00
0  
 Closing Stock   2,00,000  
Delhi Institute of Commerce and Economics 
2 Delhi Institute of Commerce and Economics 
 
Dishum  4,00,00
0  
14,00,000  Sundry Debtors  2,20,000   
Employees Provident 
Reserve  
 70,000  Less: Provision for 
Doubtful Debts  
20,000  2,00,000  
Workmen Compensation 
Reserve  
 30,000  Cash at Bank   2,00,000  
Sundry Creditors   1,00,000     
On 31st March, 2014, Kusum desired to retire from the firm and the remaining partners 
decided to carry on the business. It was agreed to revalue the assets and reassess the 
liabilities on that date, on the following basis:  
(i) Land and Building to be appreciated by 30%.  
(ii) Machinery be depreciated by 30%.  
(iii) There were Bad Debts of Rs. 35,000.  
(iv) The claim on account of Workmen Compensation Reserve was estimated at Rs. 15,000.  
(v) Goodwill of the firm was valued at Rs. 2,80,000  
(vi) remaining partners decided to pay off cash immediately to the Retiring partners by 
bringing in cash in the new profit sharing ratio and also to leave a balance of Rs1,00,000 in 
their bank account. 
(vii) they will also adjust their capitals in their new ratio which was 3:4 
Prepare Revaluation Account & Capital Accounts of Partners only    6 
  
7. Baaji, Leela and Mastani were partners in a firm sharing profits in the ratio of 5:3:2. Their Balance 
Sheet on March 31, 2015 was as follows:  
 Liabilities   Assets    
 Creditors  
 Capitals:  
 Baaji 90,000  
 Leela 56,000  
 Mastani 60,000  
 70,000  
2,06,000  
 Bank  
Debtors  
Stock  
Buildings  
Profit & Loss A/c  
 44,000  
24,000  
60,000  
1,40,000  
8,000  
  
On April 1,2015 Leela retired on the following terms:  
i. Building was to be depreciated by 10,000.  
ii. A Provision of 5% was to be made on Debtors for doubtful debts.  
iii. Salary outstanding was 4,800.  
iv. Goodwill of the firm was valued at 1,40,000.  
v. Leela was to be paid 20,800 through cheque and the balance was to be paid in two equal quarterly 
installments (starting from June 30, 2015) along with interest @ 10% p.a.  
Prepare Revaluation Account, partners’s Capital Account and leela Loan Account till it is finally paid.  8