Admission Of A Partner - 1 - Commerce Accountancy Class 12 Free MCQ Test

Test: Admission Of A Partner - 1 - Question 1

Why a new partner is admitted in the firm?

A.
To Increase the Number of partners
B.
To Increase the Capital of the firm.
C.
To Increase the Profit sharing Ratio
D.
To increase the goodwill of the firm

Detailed Solution: Question 1

The main purpose of admission of a new partner is to increase the capital of the firm. When old partners feel that the capital they have employed in the business is not enough for the future growth of the business. They may admit a new partner to maintain or to build up the financial strength of the business.

Test: Admission Of A Partner - 1 - Question 2

Out of the following, which is the main right of a partner?

A.
Right to Stop other partners for drawings
B.
Right to Share the Assets of the firm.
C.
Right to share the old profits of the firm
D.
Right to Say no for Goodwill

Detailed Solution: Question 2

When a new partner is admitted into a partnership business. He gets following rights:
1.Right to share future profits of the firm
2.Right to share in the assets of the firm
New partner is not entitled to the profits and other incomes earned by a partnership business before his admission

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Test: Admission Of A Partner - 1 - Question 3

According to Section 31 of Partnership Act 1932:

A.
New partner will bring capital and goodwill in cash
B.
New partner will inspect the books of accounts
C.
New partner is allowed to share old profits
D.
New partner is admitted by the consent of all partners

Detailed Solution: Question 3

A new partner can be admitted in the partnership firm only with the consent of all the existing partners. A new partner cannot be admitted if all existing partners are not ready to admit him as a partner.

Test: Admission Of A Partner - 1 - Question 4

Goodwill Given in the old Balance Sheet will be:

A.
Written off by the Sacrificing partners
B.
Distributed by Gainer partners
C.
Credited to old Partners Capital accounts
D.
Written off by the old partners

Detailed Solution: Question 4

Goodwill existing in the old balance sheet of a partnership firm before admitting a new partner will be written off by the old partners in their old profit sharing ratio. A new partner cannot be debited for the same.

Test: Admission Of A Partner - 1 - Question 5

A and B are partners in a firm sharing profits in the ratio of 2 : 1. They admit C as a new partner for 1/5 share. New Ratio will be 3 : 1 : 1. Sacrificing ratio will be:

A.
2 : 1
B.
1 : 7
C.
3 : 5
D.
1 : 2

Detailed Solution: Question 5

Calculation of sacrificing ratio of partners:
Old Ratio = 2:1
New Ratio = 3:1:1
Sacrificing Ratio = A : 2/3 – 3/5 = 1/15
B : 1/3 – 1/5 = 2/15

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Test: Admission Of A Partner - 1 - Question 6

A and B are partners in a firm sharing profits and losses in the ratio 1:2. They admitted C into the partnership and decide to give him 1/3 share of the future profits. Find the new ratio of the partners.

A. It is 3:2:1
B. It is 2:4:3
C. It is 3:4:2
D. It is 4:2:3

Detailed Solution: Question 6

Correct option: B

Share allotted to C = 1/3.

Remaining share for A and B = 1 - 1/3 = 2/3.

A and B will divide this 2/3 in their old ratio of 1:2. Total parts = 1 + 2 = 3.

A's new share = (1/3) × (2/3) = 2/9.

B's new share = (2/3) × (2/3) = 4/9.

C's share = 1/3 = 3/9.

Therefore A : B : C = 2/9 : 4/9 : 3/9 = 2 : 4 : 3.

Final answer: B (2 : 4 : 3)

Test: Admission Of A Partner - 1 - Question 7

Chander brought Rs 20000 for his share of goodwill. Which amount should be debited:

A.
Profit A/c
B.
Goodwil A/c
C.
Partner’s account
D.
Bank A/c

Detailed Solution: Question 7

Debiting the Bank Account for Chander's Share of Goodwill
To determine which account should be debited when Chander brings Rs 20000 for his share of goodwill, let's analyze the given options:

Profit A/c: This account is used to record the profits earned by the business. Since Chander is bringing money as his share of goodwill, it is not related to the profits of the business. Therefore, we can eliminate this option.
Goodwill A/c: Goodwill is an intangible asset that represents the reputation and value of a business. When Chander brings money for his share of goodwill, it does not affect the goodwill account directly. Hence, this option can be eliminated as well.
Partner's account: This account is used to record the transactions related to the partners' capital, drawings, and profits. When Chander brings money for his share of goodwill, it is an individual transaction and not related to the partner's capital. Thus, we can eliminate this option.
Bank A/c: This account represents the bank balance of the business. When Chander brings Rs 20000 for his share of goodwill, the money is received by the business and increases the bank balance. Therefore, the correct option is to debit the Bank A/c.

So, in this case, the Bank A/c should be debited when Chander brings Rs 20000 for his share of goodwill.

Test: Admission Of A Partner - 1 - Question 8

A, a contractor, appointed B to manage his entire work. It was agreed that B would receive 50% of the profits as his remuneration and would bear all the losses, if any. Here, B is

A.
A’s partner
B.
A’s agent
C.
Sole proprietor
D.
None of these

Detailed Solution: Question 8

Explanation:
To determine the role of B in this scenario, let's analyze the given information:
- A, a contractor, appointed B to manage his entire work.
- It was agreed that B would receive 50% of the profits as his remuneration.
- B would bear all the losses, if any.
Based on this information, we can conclude that B is A's agent. Here's why:
1. Agent Relationship:
- B has been appointed by A to manage his work. This indicates an agency relationship, where B acts on behalf of A.
2. Profit Sharing:
- B is entitled to receive 50% of the profits as remuneration. This suggests that B is working on behalf of A and sharing in the profits generated by A's work.
3. Loss Bearing:
- B has agreed to bear all the losses, if any. This further emphasizes the agency relationship, as B is taking on the risk on behalf of A.
Therefore, based on the given information, B is A's agent.

Test: Admission Of A Partner - 1 - Question 9

The Balance Sheet shows land and building Rs. 90,300. But after the change in agreement land and building be brought up to Rs.1, 19,700. By what amount land and building account should be recorded in revaluation account

A.
Rs.119700
B.
Rs.29400
C.
Rs.90300
D.
Rs.90200

Detailed Solution: Question 9

The correct answer is B.

Land and building is an asset. Revaluation account considers only the changes in assets and liabilities. So since land and building was ₹90300 earlier and now it is to be brought up to ₹119700. This means the value of land and building is increased. So revaluation will consider only the increased amount and not the whole value of building . So increased amount is 119700-90300=₹29400

Test: Admission Of A Partner - 1 - Question 10

A and B are partners in a firm sharing profits in the ratio of 2 : 1. They admit C as a new partner for 1/5 share. New Ratio of A and B will be 1 : 2. Sacrificing ratio will be:

A.
Sacrificing ratio 1 : 1
B.
Sacrificing ratio 2 : 1
C.
A’s Sacrifice 6/15 and B’s Gain 3/15
D.
Sacrificing ratio 3 : 5

Detailed Solution: Question 10

Calculation of sacrificing ratio of partners:
Old Ratio = 2:1
New Ratio of A and B = 1:2
New Ratio of A, B and C will be : 1 – 1/5 = 4/5
A’s new share = 1/3 × 4/5 = 4/15
B’s new share = 2/3 × 4/5 = 8/15
C’s Share 1/5 OR 3/15
New Ratio 4 : 8: 3
Sacrificing Ratio = A : 2/3 – 4/15= 6/15
B : 1/3 – 8/15 = 3/15 Gain

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Admission Of A Partner - 1 - Free MCQ Practice Test with solutions, Commerce

MCQ Practice Test & Solutions: Test: Admission Of A Partner - 1 (10 Questions)

Why a new partner is admitted in the firm?

Out of the following, which is the main right of a partner?

According to Section 31 of Partnership Act 1932:

Goodwill Given in the old Balance Sheet will be:

A and B are partners in a firm sharing profits in the ratio of 2 : 1. They admit C as a new partner for 1/5 share. New Ratio will be 3 : 1 : 1. Sacrificing ratio will be:

A and B are partners in a firm sharing profits and losses in the ratio 1:2. They admitted C into the partnership and decide to give him 1/3 share of the future profits. Find the new ratio of the partners.

Chander brought Rs 20000 for his share of goodwill. Which amount should be debited:

A, a contractor, appointed B to manage his entire work. It was agreed that B would receive 50% of the profits as his remuneration and would bear all the losses, if any. Here, B is

The Balance Sheet shows land and building Rs. 90,300. But after the change in agreement land and building be brought up to Rs.1, 19,700. By what amount land and building account should be recorded in revaluation account

A and B are partners in a firm sharing profits in the ratio of 2 : 1. They admit C as a new partner for 1/5 share. New Ratio of A and B will be 1 : 2. Sacrificing ratio will be:

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