Important Questions for Chapter 6- Retirement/Death of a Partner

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: 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:  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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