When there is no Goodwill Account in the books and goodwill is raised,…………….account will be debited :
  • Partner’s Capital
  • Goodwill
  • Cash
  • Reserve
Goodwill is nothing more than probability that the old customer will resort to the old place. This definition of goodwill was given by:
  • Spicer and Pegler
  • ICAI
  • Lord Elton
  • AICPA
Goodwill is to be calculated at one and half year’ purchase of average profit of last 5 years. The firm earned profits during 3 years as ₹ 20,000 ₹ 18,000 and ₹ 9,000 and suffered losses of ₹ 2,000 and ₹5,000 in last 2 years. The amount of goodwill will be :
  • ₹ 12,000
  • ₹ 10,000
  • ₹ 15,000
  • None of these
The amount of goodwill is paid by new partner :
  • for the payment of capital
  • for sharing the profit
  • for purchase of assets
  • None of these
At the time of admission of a new partners general reserve appearning in the old Balance Sheet is transferred to:
  • All Partner’s Capital Accounts
  • New Partner’s Capital Account
  • Old Partners’. Capital Accounts
  • None of these
Profit or Loss on Revaluation is borne by:
  • Old Partners
  • New Partners
  • All Partners
  • Only Two Partners
Share of goodwill brought by new partner in case is shared by old partners in :
  • Sacrificing Ratio
  • Old Ratio
  • New Ratio
  • Equal Ratio
A, Band Care three partners sharing profits and losses in the ratio of 4:3:D is admitted for 1/10 share, the new ratio will be :
  • 10 : 7 : 7 :4
  • 5 : 3 : 2 : 1
  • 4 : 3 : 2 : 1
  • None of these
A and B are partners in a firm sharing profits in the ratio of 3:They admit C as a new partner for 1/3 rd share in the profits of the firm. The new profit sharing ratio of A, B and C would be :
  • 3 : 2 : 1
  • 3 : 2 : 2
  • 3 : 2 : 3
  • 6 : 4 : 5
X and Y are partners sharing profits in the ratio of 1:They admit Z for 1/5 th share who contributed ₹25,000 for his share of goodwill. The total value of goodwill of the firm will be :
  • ₹ 2,50,000
  • ₹ 50,000
  • ₹ 1,00,000
  • ₹ 1,25,000
A, B and C are partners in a firm. If D is admitted as a new partner, then:
  • Old firm is dissolved
  • Old firm and old partnership is dissolved
  • Old Partnership is reconsitituted
  • None of these
In which ratio, the cash brought in for goodwill by the new partner is shared by the existing partners :
  • Profit sharing ratio
  • Capital ratio
  • Sacrificing ratio
  • None of these
Sacrificing ratio is ascertained at the time of:
  • Death of a partner
  • Retirement of a partner
  • Admission of a partner
  • None of these
If at the time of admission of new partner, Profit and Loss Account balance appears in the books, it will the transferred to:
  • Profit & Loss Appropriation A/c
  • All Partners’ Capital A/cs
  • Old Partners’ Capital A/cs
  • Revaluation A/c
State the ‘true’ statement:
  • Profit & Loss Adjustment A/c is prepared for revaluated of assets and liabilities on the admission of a partner
  • The new partner is liable for the past losses of the firm
  • In case the new partner is unable to bring in cash for goodwill, Goodwill Account may be raised in the firm’s books as per AS-26
  • When a partner is admitted, there is dissolution of firm
Excess of the credit side over the debit side of Revaluation account is:
  • Profit
  • Loss
  • Gain
  • Expense
Balance sheet prepared after new partnership agreement, assets and liabilities are recorded at:
  • Original Value
  • Revalued Figure
  • At Realisable Value
  • Either of (a) or (b)
Assets and Liabilities are shown at their revalued values in :
  • New Balance Sheet
  • Revaluation A/c
  • All Partner’s Capital A/c’s
  • Realisation A/c
Which of the following assets is compulsorily revalued at the time of admission of a new partner :
  • stock
  • Fixed Assets
  • Investment
  • Goodwill
A and B are partners. C is admitted with 1/5 share. C brings 7 1,20,000 as his share towards capital. The total net worth of the firm is :
  • ₹ 1,00,000
  • ₹ 4,00,000
  • ₹ 1,20,000
  • ₹ 6,00,000
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