Important Questions with Answers for CBSE Class 12 Accountancy Chapter 6 – Retirement/Death of a Partner which is outlined by expert Accountancy teachers from the latest version of CBSE (NCERT) books.
Class 12 Accountancy Chapter-6 Important Questions
Question 1
Explain Retirement of a partner.
Answer: Retirement of partner refers to retiring from the partnership, i.e., ceasing to be a partner of the enterprise. A partner may retire from the firm anytime in the following scenarios:
- If there exists an agreement to that effect
- If all the partners agree to his retirement
Also Check:Â TS Grewal Solutions for Retirement/Death of a Partner
Question 2
During the retirement of a partner, if goodwill appears in the Balance Sheet, it must be written off and the capital a/c of all the partners are debited in
a. The old profit sharing ratio
b. The new profit sharing ratio
c. The capital ratio
d. None of the above
Answer:Â a. The old profit sharing ratio
Question 3
X, Y and Z are partners sharing profits in the ratio of 2:2:1. Z retired. The new profit sharing ratio between X and Y will be,
a. 2:1
b. 1:1
c. 3:1
d. 1:3
Answer: b. 1:1
Question 4
The share of the goodwill of a retiring partner is debited to remaining partners in their,
a. Capital Ratio
b. New Ratio
c. Gaining Ratio
d. Fixed Ratio
Answer: c. Gaining Ratio
Question 5
When a partner dies, the amount of general reserve is transferred to the partners’ capital a/c in,
a. New profit sharing ratio
b. Old profit sharing ratio
c. The capital ratio
Answer: b. Old profit sharing ratio
Question 6
What is Gaining Ratio?
Answer: Gaining Ratio is such type of ratio in which partners have agreed to gain their share of profit from the other partners of the firm.
Question 7
Define the new profit sharing ratio.
Answer: New profit sharing ratio is the ratio by which existing partner and new partner will share profits and losses of the firm.
Question 8
Explain the meaning of Sacrificing Ratio.
Answer: Sacrificing Ratio is the ratio in which the old partners agree to sacrifice their shares of profit in favour of new or incoming partner.
Question 9
Pass the necessary journal entry when the Goodwill does not appear in the books.
Answer: The journal entry passed is as follows,
Goodwill a/c Dr.
To all partner’s capital a/c (in old profit sharing ratio)
Question 10
How is the new profit sharing ratio mathematically stated?
Answer: New share of a partner = Old Share + Acquired Share
Question 11
Pass the necessary journal entry when the Goodwill appears in the books.
Answer: The journal entry passed is,
All Partner’s capital a/c Dr.
To Goodwill a/c
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