WorksheetsValuation of goodwill
Total questions: 41
Worksheet time: 21mins
Nature of goodwill is
intangible asset
fictitious asset
long term liability
current asset
[1] Reserve appearing in the Balance Sheet at the time of admission of a partner, is distributed among partners in their (a) Ratio.
At the time of admission, the assets are revalued and liabilities are reassessed. The increase or decrease in the values is debited or credited in (a) Account.
Sacrificing ratio is computed at the time of (a)
At the time of admission, Gain (Profit) or Loss on revaluation is shared by the old partners
in their (a) ratio.
Revaluation account is a (a) account.
In the case of downward revaluation of an asset, Revaluation Account is (a) .
At the time of admission of a partner new profit-sharing ratio is used for sharing future (a) ’
A, B and C share profits and losses in the ratio of 3:2:1. On admission of D, they agree to share profits and losses in the ratio of 5:4:2:1.Sacrificing Ratio of A, B and C will be (a) .
Q1 When goodwill is not recorded in the books at all on admission of a partners ?
If paid privately
If brought in cash
If not brought in cash
If brought in Kind
The Need of revaluation of assets and liabilities on admission
Assets and Liabilities should appears at revised values
Any profit and loss an account of change in values belong to old partners
All unrecorded assets and liabilities get recorded
None of Above
When new partner brings cash for goodwill , the amount is credited to :
Realisation Account
Cash account
Premium for Goodwill Account
Revaluation Account
A and B are Partners sharing Profits in the ratio of 3:2. They Admit C for ¼ share who contributed Rs 30,000 for his share of goodwill. The total value of the goodwill of the firm will be :
Rs 1,50,000
Rs 1,20,000
Rs 1,00,000
Rs 1,60,000
If the new partner brings any additional amount of cash other than his capital contributions then it is termed as :
Capital
Reserves
Profits
Premium for Goodwill
X and Y are partners sharing profits and losses in the ratio of 3 : 2. Z is admitted for 1/5th share in profits which he gets from X. New profit sharing ratio will be
12 : 8 : 5
8 : 12 : 5
2 : 2 : 1
2 : 2 : 2
A and B are partners sharing profits in the ratio of 7 : 3. C is admitted as a new partner. "A" gave 1/7th of his share and "B" gave 1/3rd of his share to C. New Profit-sharing Ratio will be:
6 : 2 : 2
4 : 1 : 1
3 : 2 : 2
None
At the time of admission of a partner , general reserve appearing in the old Balance sheet is transferred to
All partners capital account
New partner capital account
Old partner capital account
None of the above
A, B and C are partners in a Firm. If D is admitted as a new partner :
Old Firm is dissolved
Old Firm and partnership is dissolved
Old partnership is reconstitution.
None of the above
What right a newly admitted partner acquires in the firm after his admission?
Right to vote
Right to admit any partner
Right to share assets of the firm
None of the above
A and B are partners, sharing profits in the ratio of 5:3. They admit C with 1/5 share in profits, which he acquires equally from both 1/10 form A and 1/10 from B. New profit sharing ratio will be:
(a) 21:11:8
(b) 20:10:4
(c) 15:10:5
(d) None
A firm has an unrecorded investment of ₹ 5,000. Entry in the firm’s journal on admission of a partners will:
(a) Revaluation A/c Dr. 5,000
To Unrecorded Investment A/c 5,000
(b) Unrecorded Investment A/c Dr. 5,000
To Revaluation A/c 5,000
(c) Partner’s Capital A/c Dr. 5,000
To Unrecorded Investment 5,000
(a) None of these
A, B, C are partners sharing profits in the ratio of 4:3:2. D is admitted for 2/9th share of profits and brings ₹ 30,000 as capital and 10,000 for his share of goodwill. The new profit sharing ratio between partners will be 3:2:2:2. Goodwill amount will be credited in the capital accounts of:
(a) A only
(b) A, B and C equally
(c) A, and B (equally)
(d) A and C (equally)
X and Y are partners sharing profits in the ratio of 3:1. They admit Z as a partner who pays ₹ 4,000 as goodwill, the new profit sharing ratio being 2:1:1 among X, Y, Z. The amount of goodwill will be credited to:
(a) X and Y as ₹ 3,000 and ₹1,000
(b) X only
(c) Y only
(d) None
A, B, C are equal partners, they wanted to change the profit sharing ratio into 4:3:2. They raised the goodwill to ₹ 90,000 but want to write it off immediately. The effected accounts will be:
(a) C’s Capital A/c Dr. 10,000
To A’s Capital A/c 10,000
(b) B’s Capital A/c Dr. 10,000
To A’s Capital A/c 10,000
(c) C’s Capital A/c Dr. 10,000
To B’s Capital A/c 10,000
(d) A’s Capital A/c Dr. 10,000
To C’s Capital A/c 10,000
A and B are partners C is admitted with 1/5th share C brings ₹ 1,20,000 as his share towards capital. The total net worth of the firm is:
(a) ₹ 1,00,000
(b) ₹ 4,00,000
(c) ₹ 1,20,000
(d) ₹ 6,00,000
The opening balance of Partner’s Capital Account is credited with:
(a) Interest on Capital
(b) Interest on Drawings
(c) Drawings
(d) Share in Loss
On the admission of new partner, which one of the following lying in the balance sheet should be transferred to the capital accounts of the old partners in the old profit sharing ratio?
(a) Bank Overdraft
(b) General Reserve
(c) Bill payable
(d) Outstanding Expenses.
Sacrificing Ratio is computed at the time of _______.
(a) Retirement of a Partner
(b) Admission of a partner
(c) Insolvency of a Partner
(d) Death of a Partner.
Which asset is compulsorily revalued at the time of admission of a partner?
(a) Goodwill
(b) Land and Building
(c) Plant and Machinery
(d) Furniture and Fittings
If an asset was earlier revalued upward and then later on it was revalued downward, then the downfall to the extent of earlier appreciation is:
(a) Credited to Revaluation Reserve Account
(b) Debited to Revaluation Reserve Account
(c) Credited to Profit and Loss Account
(d) Debited to Profit and Loss Account
Old partner distribute amount of goodwill in
Old ratio
New ratio
Capital ratio
Sacrificing ratio
When new partner doesnot brings goodwill for cash treatment of goodwill recommend ed by
AS 4
AS 27
AS 26
None of these
When new patner donot brings goodwill in cash
New partners current capital is debited
Old partners current capital is debited
New partners capital is debited
All of above
At the time of admission of a partner, there is some unrecorded liability, then it will be :
Credited to revaluation A/C
Debited to revaluation A/C
Transferred to old partners capital A/C
Transferred to new partners capital A/C
At the time of Admission of a partner:
Old Firm Is Dissolved
Old partnership is Dissolved
Both old firm and partnership is Dissolved
Neither of them is Dissolved
When a new partner brings his share of goodwill in cash, the amount is debited to :
Premium A/C
Cash A/C
Capital A/C of old partners
Capital A/C of new partners
Profit on revaluation of assets and liabilities is distributed among the partners in their :
New profit sharing ratio
Old profit sharing ratio
Sacrificing ratio
Gaining Ratio
Sacrificing ratio is used to distribute ________ in case of admission of a partner
Reserves
Goodwill
Revaluation Profit
Balance in Profit and Loss A/C
Goodwill of a firm of A and B is valued at rupees 30,000.It is appearing in the books of Rs 12,000. C is admitted for 1/4 share. What amount he is supposed to bring for goodwill ?
Rs 30,000
Rs 4,500
Rs 7,500
Rs 3,000
A, B, and C are partner sharing profits in ratio 3: 2: 1. They agree to admit D into the firm. A, B, and C agreed to give 1/3rd, 1/6th, 1/9th share of their profit. The share of profit of D will be
1/10
11/54
12/54
13/54
