CBSE Class 12 Accountancy – MCQ and Online Tests – Unit 4 – Reconstitution of Partnership Firm: Retirement / Death of a Partner
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CBSE Class 12 Accountancy – MCQ and Online Tests – Unit 4 – Reconstitution of Partnership Firm: Retirement / Death of a Partner
Question 1.
In case of death of a partner, the whole amount standing to the credit of his capital account is transferred to :
(a) Capital Accounts of all partners
(b) Capital Accounts of remaining partners
(c) His Executor’s Account
(d) Account of the Government
Answer
Answer: (c) His Executor’s Account
Question 2.
A, B and C are partners sharing profits and losses in the ratio of 3 : 2 :1. On 1.3.2016 C died. The average profits of the firm for last four years were ₹ 72,000 Books are closed on 31st December. C’s share of profit till the date of his death will be:
(a) ₹ 2,000
(b) ₹ 12,000
(c) ₹ 1,400
(d) ₹ 24,000
Answer
Answer: (a) ₹ 2,000
Question 3.
The amount due to the deceased partner is paid to his……….
(a) Father
(b) Friend
(c) Wife
(d) Executors
Answer
Answer: (d) Executors
Question 4.
B, C and D are partners sharing profit in the ratio 7:5:4. D died on 30th June, 2016 and profits for the year 2015-16 were ₹ 12,000. How much share in profits for the period 1st April, 2016 to 30th June, 2016 will be credited to D’s Account:
(a) ₹ 3,000
(b) ₹ 750
(c) Nil
(d) ₹ 1,000
Answer
Answer: (b) ₹ 750
Question 5.
On the death of a partner in a firm payments are made to;
(a) Capital A/c
(b) Executor’s A/c
(c) Current A/c
(d) Loan A/c
Answer
Answer: (b) Executor’s A/c
Question 6.
X, Y and Z share profits in the ratio of \(\frac{1}{2}: \frac{1}{3}: \frac{1}{6}, \mathbf{Z}\) dies. New ratio of X and Y will be :
(a) 3 : 2.
(b) 2 : 3
(c) 2 : 1
(d) None of these
Answer
Answer: (a) 3 : 2.
Question 7.
Revaluation Account is prepared at the time of …………
(a) Admission of a partner
(b) Retirement of a partner
(c) Death of a partner
(d) All of the above
Answer
Answer: (d) All of the above
Question 8.
The executors of deceased partner will be paid interest on the amount due from the date of death of the partner at:
(a) 5% p.a.
(b) 6% p.a.
(c) 7% p.a.
(d) 8% p.a.
Answer
Answer: (b) 6% p.a.
Question 9.
In the event of death of a partner, the accumulated profits and losses are shared by the partners in their:
(a) Old Profit-sharing Ratio
(b) New Profit-sharing Ratio
(c) Capital Ratio
(d) None of these
Answer
Answer: (a) Old Profit-sharing Ratio
Question 10.
On death of a partner, the remaining partner(s) who have gained due to change in profit-sharing ratio should compensate the:
(a) Deceased partner
(b) Remaining partners (who have sacrificed) as well as decreased partner
(c) Remaining partners (who have sacrificed)
(d) None of these
Answer
Answer: (a) Deceased partner
Question 11.
A, B and C are partners sharing profits and losses in the ratio of 2 : 2 : 1. C died on 31st March, 2016. The profits of the financial year ending 31st March, 2016 is ₹ 64,000. The share of the deceased partner in the profits will be:
(a) ₹ 9,200
(b) ₹ 12,800
(c) ₹ 3,100
(d) ₹ 6,100
Answer
Answer: (b) ₹ 12,800
Question 12.
Joint Life Policy amount received by a firm is distributed in:
(a) Opening Capital Ratio
(b) Closing Capital Ratio
(c) Old Profit-sharing Ratio of Partners
(d) New Profit-sharing Ratio
Answer
Answer: (c) Old Profit-sharing Ratio of Partners
Question 13.
A, B and C are partners sharing profits in the ratio of 3 : 2 : 1. They had a Joint Life Policy of ₹ 3,00,000. Surrender value of JLP in Balance Sheet is ₹ 90,000. C dies what is share of each partner in JLP ?
(a) ₹ 1,05,000 ; ₹ 70,000; ₹ 35,000
(b) ₹ 45,000 ; ₹ 30,000; ₹ 15,000
(c) ₹ 1,50,000 ; ₹ 1,00,000 ; ₹ 50,000
(d) ₹ 1,95,000 ; ₹ 1,30,000 ; ₹ 65,000
Answer
Answer: (c) ₹ 1,50,000 ; ₹ 1,00,000 ; ₹ 50,000
Question 14.
JLP of the partners is a/an…………..account
(a) Nominal
(b) Personal
(c) Liability
(d) Asset
Answer
Answer: (d) Asset
Question 15.
On the death of a partner, the amount of Joint Life Insurance Policy is credited to the Capital Accounts of:
(a) Only the deceased partner
(b) All partners including the deceased partner
(c) Remaining partners, in the new profit-sharing ratio
(d) Remaining partners, in their old profit-sharing ratio
Answer
Answer: (b) All partners including the deceased partner
Question 16.
X, Y and Z are partners sharing profits in the ratio of 7 : 5 :4. On 30th June, 2015 Z died and profits for the year ending 31st March, 2016 were ₹ 2,40,000. How much share in profits for the period 1st April to 30th June, 2015 will be credited to Z’s account assuming the profit occurred evenly throughout the year ;
(a) ₹ 60,000
(b) ₹ 15,000
(c) ₹ 20,000
(d) Nil
Answer
Answer: (b) ₹ 15,000
Question 17.
As per section 37 to the Indian Partnership Act, 1932, the executors would be entitled at their choice to interest calculated from the date of death till the date of payment on the final amount due to the deceased partner at………..percent per annum.
(a) 7
(b) 4
(c) 6
(d) 8
Answer
Answer: (c) 6
Question 18.
X, Y and Z are the partners sharing profits in the ratio 2 : 1 : 1. Firm has a joint life policy of ₹ 1,20,000 and in the balance sheet it is appeaming at the surrender value, i.e., ₹ 20,000. On the death of X how this JLP will be distributed among partners:
(a) 50,000 : 25,000 : 25,000
(b) 60,000 : 30,000 : 30,000
(c) 40,000 : 35,000 : 25,000
(d) whole ₹ 1,20,000 to A
Answer
Answer: (b) 60,000 : 30,000 : 30,000
Question 19.
A, B and C are partners sharing profits and losses in the ratio of 3 : 2 :1. C dies and goodwill of the firm is valued at ₹ 60,000. The amount payable to the executor’s of the deceased partner will be :
(a) ₹ 30,000
(b) ₹ 25,000
(c) ₹ 10,000
(d) ₹ 20,000
Answer
Answer: (c) ₹ 10,000
Question 20.
On death of a partner, his excutor is paid the profits of
the deceased partner for the relevant period. This payment is recorded in Profit & Loss A/c :
(a) Adjustment
(b) Appropriation
(c) Suspense
(d) Reserve
Answer
Answer: (c) Suspense
Question 21.
Which account is prepared at the time retirement or death of a partner to show the changes in the value of assets and liabilities:
(a) Revaluation A/c
(b) Realisation A/c
(c) Partner’s Capital A/c
(d) None of these
Answer
Answer: (a) Revaluation A/c
Question 22.
What are the methods of calculating share of the deceased partner in the profit of the firm upto the date of death:
(a) On time basis
(b) On sales basis
(c) Both (a) and (b)
(d) None of these
Answer
Answer: (c) Both (a) and (b)
Question 23.
M, L and A are partners sharing profits in the ratio of 9:4:3. They have taken a joint life policy of ₹ 96,000. A dies. What is the share of A in the JLP amount ?
(a) ₹ 18,000
(b) ₹ 24,000
(c) ₹ 54,000
(d) ₹ 20,000
Answer
Answer: (a) ₹ 18,000
Question 24.
If three partners A, B & C are sharing profits as 5:3:2, then on the death of a partner A, how much B & C will pay to A’s executor on account of goodwill ? Good-will is to be calculated on the basis of 2 years purchase of last 3 years average profits. Profits for the last three years are 10,80,000 Rs. :
(a) ₹ 2,16,000 and ₹ 1,42,000
(b) ₹ 2,44,000 and ₹ 2,16,000
(c) ₹ 3,60,000 and ₹ 2,16,000
(d) ₹ 2,16,000 and ₹ 1,44,000
Answer
Answer: (d) ₹ 2,16,000 and ₹ 1,44,000
Question 25.
On the retirement of a partner any accumulated profit should be credited to the capital accounts of:
(a) All partners in old profit-sharing ratio
(b) Remaining partners in new profit-sharing ratio
(c) Retiring partner only in his share
(d) None of these
Answer
Answer: (a) All partners in old profit-sharing ratio
Question 26.
On the retirement of a partner, full amount of goodwill may be credited to the capital accounts of:
(a) Retiring partners
(b) Remaining partners
(c) All partners
(d) None of these
Answer
Answer: (c) All partners
Question 27.
On retirement of a partner’s the amount of General Reserve is transferred to all partner’s capital account in:
(a) New Profit Sharing Ratio
(b) Capital Ratio
(c) Old Profit Sharing Ratio
(d) None of these
Answer
Answer: (c) Old Profit Sharing Ratio
Question 28.
On the retirement of a partner, profit on revaluation of assets and liabilities should be credited to the Capital Accounts of:
(a) All partners in the old profit-sharing ratio
(b) The remaining partners in their old profit-sharing ratio
(c) The remaining partners in their new profit-sharing ratio
(d) None of these
Answer
Answer: (a) All partners in the old profit-sharing ratio
Question 29.
Outgoing partner is compensated for parting with firm’s future profits in favour of remaining partners. The remaining partners contribute to such compensation in:
(a) Gaining Ratio
(b) Capital Ratio
(c) Sacrificing Ratio
(d) Profit-sharing Ratio
Answer
Answer: (a) Gaining Ratio
Question 30.
X, Y and Z were partners sharing profits in the ratio of 5 : 3 : 2. Goodwill does not appear in the books but it is agreed to be worth 1,00,000 Rs.. X retires from the firm and Y and Z decide to share profits equally. X’s share of goodwill will be debited to Y’s and Z’s Capital A/cs in………ratio:
(a) \(\frac{1}{2}: \frac{1}{2}\)
(b) 2 : 3
(c) 3 : 2
(d) None of these
Answer
Answer: (b) 2 : 3
Question 31.
Gaining ratio is calculated :
(a) At the time of admission of a new partner
(b) At the time of retirement of a partner
(c) On the dissolution of partnership firm
(d) None of these
Answer
Answer: (b) At the time of retirement of a partner
Question 32.
Joint life policy be taken by the firm on the lives of:
(a) All the partners jointly
(b) All the partners separately
(c) All employees of the firm
(d) Both (a) and (b)
Answer
Answer: (d) Both (a) and (b)
Question 33.
How unrecorded assets are treated at the time of retriement of a partner ?
(a) Credited to Revaluation Account
(b) Credited to Capital Account of Retiring Partner
(c) Debited to Revaluation Account
(d) Credited to Partner’s Capital Accounts
Answer
Answer: (a) Credited to Revaluation Account
Question 34.
The amount of General Reserve is transferred to all partner’s capital accounts in:
(a) New Profit-sharing Ratio
(b) Capital Ratio
(c) Old Profit-sharing Ratio
(d) None of these
Answer
Answer: (c) Old Profit-sharing Ratio
Question 35.
On retirement of a partner, the retiring Partner’s Capital Account will be credited with:
(a) His/her share of goodwill
(b) Goodwill of the firm
(c) Share of goodwill of remaining partners
(d) None of these
Answer
Answer: (a) His/her share of goodwill
Question 36.
x,y are z are partners and share profits in the ratio of 5 : 3 : 2. y retires and x takes 1/10 from y and z takes 1/5 from y. The new profit sharing ratio will be :
(a) 7 : 13
(b) 13 : 7
(c) 3 : 2
(d) 1 : 1
Answer
Answer: (c) 3 : 2
Question 37.
On death of a partner, the firm gets for joint life policy taken for all partners.
(a) Policy amount
(b) Surrender value
(c) Policy amount of deceased partner
(d) Surrender value of all partners
Answer
Answer: (a) Policy amount
Question 38.
A, Band Care equal partners in a firm. B retires and the remaining partners decide to share profits of the new firm in the ratio of 5 : 4. Gaining ratio will be:
(a) 2 : 1
(b) 1 : 2
(c) 4 : 5
(d) 5 : 4
Answer
Answer: (a) 2 : 1
Question 39.
The old profit-sharing ratio among Rajender, Satish and Tejpal were 2 : 2 : 1. The new profit-sharing ratio after Satish’s retirement is 3 : 2. The gaining ratio is :
(a) 3 : 2
(b) 2 : 1
(c) 1 : 1
(d) 2 : 3
Answer
Answer: (c) 1 : 1
Question 40.
A, B are C are sharing profits in the ratio of \(\frac{1}{2}: \frac{1}{3} \div \frac{1}{6}\) C retired. Gaining ratio will be :
(a) 2 : 1
(b) 2 : 3
(c) 3 : 2
(d) 1 : 2
Answer
Answer: (c) 3 : 2
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