Accounting for Goodwill

Q.

A, B and C are partners sharing profits in 3:2:2 ratio. They admitted D as a new partner for 1/5 share which he acquired from A, B and C in 2:2:1 ratio respectively. Calculate new profit sharing ratio?

Q.

Aditya and Balan are partners sharing profits and losses in 3:2 ratio. They admitted Christopher for 1/4 share in the profits. The new profit sharing ratio agreed was 2:1:1. Christopher brought Rs. 50, 000 for his capital. His share of goodwill was agreed to at Rs. 15, 000. Christopher could bring only Rs. 10, 000 out of his share of goodwill. Record necessary journal entries in the books of the firm?

Q.

What is the entry for withdrawal of amount brought in as goodwill by old partners?

1. Goodwill

2. Investment

3. Fixed Assets

4. Stock

Q.

Sangeeta, Saroj and Shanti are partners sharing profits in the ratio of 2:3:5. Goodwill is appearing in the books at a value of Rs 60, 000. Sangeeta retires and goodwill is valued at Rs 90, 000. Saroj and Shanti decided to share future profits equally. Record necessary Journal entries.

Q. Jaspal and Rosy were partners with capital contribution of ₹ 10, 00, 000 and ₹ 5, 00, 000 respectively. They do not have a Partnership Deed. Jaspal wants that profits of the firm should be shared in their capital ratio. Rosy convinced jaspal that profits should be shared equally. Explain how Rosy would have convinced Jaspal for sharing the profit equally.

Q.

A, B and C are partners sharing profits in 2:2:1 ratio admitted D for 1/8 share which he acquired entirely from A. Calculate new profit sharing ratio?

Q.

Singh, Gupta and Khan are partners in a firm sharing profits in 3:2:3 ratio. They admitted Jain as a new partner. Singh surrendered 1/3 of his share in favour of Jain: Gupta surrendered 1/4 of his share in favour of Jain and Khan surrendered 1/5 in favour of Jain. Calculate new profit sharing ratio?

Q.

A and B are partners sharing profits in the ratio of 3:2. They decided to admit C and decided to share profits equally. In this case, who is sacrifing the share of profits?

1. C only

2. A only

3. B only

4. Both A & B

Q.

Amar and Samar were partners in a firm sharing profits and losses in 3:1 ratio. They admitted Kanwar for 1/4 share of profits. Kanwar could not bring his share of goodwill premium in cash. The Goodwill of the firm was valued at Rs. 80, 000 on Kanwar’s admission. Record necessary journal entry for goodwill on Kanwar’s admission.

Q.

Sandeep and Navdeep are partners in a firm sharing profits in 5:3 ratio. They admit C into the firm and the new profit sharing ratio was agreed at 4:2:1. Calculate the sacrificing ratio?

Q.

Profit and losses ratio is for 3:2:1, for A, B and C respectively. From 1st April 2018, they decide to share profit and losses equally. Value of Goodwill of the firm is Rs 24, 000. Who amongst the following has made a sacrifice?

1. None of the above

2. A only

3. B only

4. Both A & B

Q.

Which type of goodwill is best?

Q.

X & Y are partners sharing profit in the ratio of 3: 2. Z is admitted as a new partner with 1/5th share. What shall be the sacrificing ratio ?

1. 4:5

2. 2:3

3. 3:2

4. 1:5

Q. A, B and C were in partnership sharing profits and losses In the ratio of 4 : 2 : 1 respectively. It was provided that C's share in profit for a year would not be less than Rs. 7, 500. The profit for the year ended 31st March, 2018 amounted to Rs. 31, 500; You are required to show the appropriation among the partners The Profit and Loss Appropriation Account is not required.

Q. A and B are sharing profits and losses equally. With effect from 1st April, 2018, they agree to share profits in the ratio of 4 : 3. Calculate individual partners gain or sacrifice due to the change in ration.

Q. X and Y are partners in a partnership firm sharing profits in the ratio of 5:3 with a capital of Rs. 5, 00, 000 & Rs. 4, 00, 000 respectively. Z was admitted on the following terms: Z would pay Rs. 100, 000 as capital and Rs. 32, 000 as Goodwill, for a 1/5th share of profit. The balances of capital accounts after the admission of Z will be in the ratio of _______.

1. 5, 20, 000 : 4, 12, 000 : 1, 00, 000
2. 5, 00, 000 : 4, 00, 000 : 1, 00, 000
3. 5, 12, 000 : 4, 20, 000 : 1, 00, 000
4. None of these

Q.

A bus travels $120$ km in $3$ hours. How long will it take to travel $300$ km​?

Q.

Distinguish between sacrificing ratio and gaining ratio.

Q. When a partner is given guarantee by the other partner, loss on such guarantee will be borne by -

1. All the other partners
2. Partnership firm
3. Partner with the highest ratio
4. Partner giving guarantee

Q. X and Y formed a partnership firm to undertake construction of a Railway Bridge for Northern Railways at a Patna.This partnership is __________.

1. Particular partnership
2. Joint venture
3. Partnership at will
4. Limited Partnership

Q. Which of these is/are point of difference between a partnership firm and a Hindu Undivided Family.

1. Right to manage business
2. Mode of creation
3. Manner of dissolution
4. All the three

Q.

Whenever the mutual rights of the partners change, then the partner who makes a sacrifice must be compensated.

1. Sacrificing Ratio

2. New Ratio

3. Goodwill

4. Gaining ratio

Q. X, Y & Z are partners sharing profits and losses in the ratio of 3:2:1. Y retired from the firm. New profit sharing ratio between X & Z is 5:3. What is the gain ratio of the partners X & Z?

1. 3:2
2. 3:1
3. 3:7
4. 3:5

Q. The difference between two nos is 80 if the ratio of two no is 2:5 then find the no

Q. A, B & C are sharing profits in 4:3:2 ratio. B retires. If A & C shares profits of B in 5:3, then find the new profit sharing ratio.

1. 47:25
2. 17:11
3. 31:11
4. 14:21

Q. A, B & C partners sharing profits & losses in the ratio of 4:3:2. B decided to retire from the firm. Calculate the new profit sharing ratio of A & C if B gives his share to A & C in equal proportion.

1. 7:2
2. 25:11
3. 11:7
4. 2:1

Q.

Give two circumstances under which the fixed capitals of partners may change.

Q. Objective Type Questions :
Answer in one sentence only.

When is the ratio of sacrifice to be calculated?

Q. Sacrifice by a partner is equal to ________________.

1. Old Share of Profit X New Share of Profit
2. Old Share of Profit + New Share of Profit
3. New Share of Profit - Old Share of Profit
4. Old Share of Profit - New Share of Profit

Q.

The ratio of incomes of Seema and Nadira is $3:4$ and the ratio of incomes of Nadira and Mary is $24:17$ . Find the ratio of Seema and Mary.