MCQ Class 12 Accountancy Chapter 4 Reconstitution Of A Partnership Firm – Retirement/Death Of A Partner

Check the below NCERT MCQ Class 12 Accountancy Chapter 4 Reconstitution Of A Partnership Firm – Retirement/Death Of A Partner with Answers available with PDF free download. MCQ Questions for Class 12 Accountancy with Answers were prepared based on the latest syllabus and examination pattern issued by CBSE, NCERT and KVS. Our teachers have provided below Reconstitution Of A Partnership Firm – Retirement/Death Of A Partner Class 12 Accountancy MCQs Questions with answers which will help students to revise and get more marks in exams

Reconstitution Of A Partnership Firm – Retirement/Death Of A Partner Class 12 Accountancy MCQs Questions with Answers

Refer below for MCQ Class 12 Accountancy Chapter 4 Reconstitution Of A Partnership Firm – Retirement/Death Of A Partner with solutions. Solve questions and compare with the answers provided below

Ques. A, B and C are partners sharing profit or loss in the ratio of 2 : 3 : 4. A retires and after A’s retirement B and C agreed to share profit or loss in the ratio of 3 : 4 in future. Their gaining ratio will be :

(A) 2 : 3
(B) 4 : 3
(C) 3 :4
(D) 1 : 1

Ques. A, B and C are partners sharing profits in the ratio of 1/2 : 1/4 : 1/4. New ratio on the retirement of B will be :(A) 2 : 4
(B) 1 : 2
(C) 2 : 1
(D) 1/4 : 1/2

Question. As per section ———— of the Indian Partnership Act, a retiring partner becomes entitled to profits after retirement if his dues remain unpaid
a) Section 73
b) Section 26
c) Section 4
d) Section 37

Ques. The amount due to deceased partner is paid to
(a) His Father.
(b) His Wife.
(c) His Legal Heir,
(d) Remaining Partners.

Ques. A, B and C are partners in a firm sharing profit/loss in the ratio of 2 : 2 : 1. On March 31, 2019, C died. Accounts are closed on Dec., 31 every year. The sales for the year 2018 was Rs.6,00,000 and the profits were Rs.60,000. The sales for the period from Jan. 1,2019 to March 31, 2019 were Rs.2,00,000. The share of deceased partner in the current year’s profits on the basis of sales is :
(A) Rs.20,000
(B) Rs.8,000
(C) Rs.3,000
(D) Rs.4,000

Question: On retirement, the value of goodwill is credited to:
A) All partners.
B) Continuing partners.
C) Retiring partner.
D) None of the above.

Question. P, Q and R were partners in a firm in the ratio of 5:4:3. They admit S for 1/7 share. It is agreed that Q would retain his original share. ———– will be the sacrificing ratio between P and R.
a) 5:4
b) 1:1
c) 5:3
d) 4:3

Ques. ‘Gaining Ratio’ means :
(A) Old Ratio – New Ratio
(B) New Ratio – Old Ratio
(C) Old Ratio – Sacrificing Ratio
(D) New Ratio – Sacrificing Ratio

Ques. Which of the following statement is correct?
(a) Goodwill at the time of retirement of a partner is credited to remaining Partners’ Capital Accounts in sacrificing ratio.
(b) Goodwill at the time of retirement of a partner is credited to remaining Partners’ Capital Accounts in gaining ratio.
(c) Goodwill at the time of retirement of a partner is debited to remaining Partners’ Capital Accounts in sacrificing ratio.
(d) Goodwill at the time of retirement of a partner to the extent of retiring Partner’s Share is debited to remaining Partners’ Capital Accounts in gaining ratio.

Ques. A, B and C are equal partners in a firm. B retires and the remaining partners decide to share the profits of the new firm in the ratio of 5 : 4. Gaining ratio will be :
(A) 1 :1
(B) 1 : 2
(C) 2 : 1
(D) 5 : 4

Question: A, B and C are partners sharing profits and losses in the ratio of 3 : 2 :1. On 1.3.2016 C died. The average profits of the firm for last four years were ₹ 72,000 Books are closed on 31st December. C’s share of profit till the date of his death will be:
(A) ₹ 2,000
(B) ₹ 12,000
(C) ₹ 1,400
(D) ₹ 24,000

Question: On retirement of a partner, goodwill will be credited to the Capital Account of:
(A) Retiring Partner
(B) Remaining Partners
(C) All Partners
(D) None of the Above

Question: A, B and C share profits and losses of the firm equally. B retires from business and his share is purchased by A and C in the ratio of 2 : 3. New profit sharing ratio between A and C respectively would be :
(A) 01 : 01
(B) 02 : 02
(C) 07 : 08
(D) 03 : 05

Question: On the retirement of a partner, full amount of goodwill may be credited to the capital accounts of:
(A) Retiring partners
(B) Remaining partners
(C) All partners
(D) None of these

Ques. A, B and C are partners sharing profits in the ratio of 1/4 : 3/10 : 9/20. The New ratio on the retirement of C will be :
(A) 6:5
(B) 5:6
(C) 4 : 3
(D) 4 : 10

Ques. A, Band Care partners sharing profit and losses in the ratio of 2:2:1.B died, at that time goodwill of the firm valued at Rs. 30,000. What contribution has to be made by A and C in order to pay B’s Executor?
(a) Rs. 20,000 and Rs. 10,000.
(b) Rs. 15,000 and Rs. 15,000.
(c) Rs. 8,000 and Rs. 4,000.
(d) Rs. 6,000 and Rs. 6,000.

Question: X, Y and Z were partners in a firm sharing profits in the ratio of 3 : 2 : 1. X retired and the new profit sharing ratio between Yand Z will be 5 : 4. On Xs retirement the goodwill of the firm was valued at ₹54,000. Journal entry will be :
(A) Y’s Capital A/c Dr. 24,000 Z’s Capital A/c Dr. 30,000 To X’s Capital A/c 54,000
(B) Y’s Capital A/c Dr. 15,000 Z’s Capital A/c Dr. 12,000 To X’s Capital A/c 27,000
(C) Y’s Capital A/c Dr. 12,000 Z’s Capital A/c Dr. 15,000 To X’s Capital A/c 27,000
(D) X’s Capital A/c Dr. 27,000 To Y’s Capital A/c 12,000 To Z’s Capital A/c 15,000

Question: At the time of retirement of a partner, if goodwill appears in the balance sheet, it must be written off, the capital accounts of all partners are debited in
(A) None of the options
(B) The new profit sharing ratio
(C) The capital ratio
(D) The old profit sharing ratio

Ques. On the death of a partner, the amount due to him will be credited to :
(A) All partner’s Capital Accounts
(B) Remaining partner’s Capital Accounts
(C) His Executor’s Account
(D) Governments’ Revenue Account

Question: A, B and C are partners sharing profits in the ratio of 5 : 2 : 1. If the new ratio on the retirement of A is 3 : 2, what will be the gaining ratio?
(A) 11: 14
(B) 3 : 2
(C) 2 : 3
(D) 14:11

Question.. Abhishek, Rajat and Vivek are partners sharing profits in the ratio of 5 : 3 : 2. If Vivek retires, the new Profit Sharing Ratio between Abhishek and Rajat will be :
(a) 3 : 2
(b) 5 : 3
(c) 5 : 2
(d) None of these

Question. Q and R were partners sharing profits in the ratio 2 : 2 : 1. Q retires and the new profit sharing ratio of P and R will be 3 : 1. Gaining ratio will be :
(A) 1 : 7
(B) 2 : 1
(C) 1 : 2
(D) 7 : 1

Question. A, B and C were partners sharing profits and losses in the ratio of 2 : 2 : 1. Books are closed on 31st March every year. C dies on 5th November, 2018. Under the partnership deed, the executors of the deceased partner are entitled to his share of profit to the date of death, calculated on the basis of last year’s profit. Profit for the year ended 31 st March, 2018 was Rs.2,40,000. C s share of profit will be :
(A) Rs.28,000
(B) Rs.32,000
(C) Rs.28,800
(D) Rs.48,000

Question.P,Q and R were partners sharing profits in the ratio of their Capital contribution which were Rs.6,00,000; Rs.4,00,000 and Rs.5,00,000 respectively. Their books are closed on 31st March every year. P dies on 24th August, 2018. Under the partnership deed, deceased partner is entitled to his share of profit/loss to the date of death based on the average profits of preceding three years. Profits were 2015 Rs.50,000; 2016 Rs. 1,20,000 (Loss); 2017 Rs.30,000 and 2018 Rs.60,000. P’s share of profit/loss will be :
(A) Rs.3,200
(B) Rs.6,400
(C) Rs. 12,000
(D) Rs. 4,800 

Question.On the retirement of Hari from the firm of Hari, Ram and Sharma, the Balance Sheet showed a debit balance of Rs. 12,000 in the Profit and Loss Account. For calculating the amount payable to Hari, this balance will be transferred
(a) to the credit of the Capital Accounts of Hari, Ram and Sharma equally.
(b) to the debit of the Capital Accounts of Hari, Ram and Sharma equally.
(c) to the debit of the Capital Accounts of Ram and Sharma equally.
(d) to the credit of the Capital Accounts of Ram and Sharma equally.

Question. A, B and C are partners sharing profits in the ratio of 3:2:1, C retired. New profit-sharing ratio will be
(a) 1:3.
(b) 3:2.
(c) 1:1.
(d) None of these.

Question. A, S and C are partners sharing profits in the ratio of 3: 2:1, C retired, and new profit-sharing ratio is 3:2. Gaining ratio will be
(a) 3:2.
(b) 1:2.
(c) 2:1.
(d) None of these.

Question. A, B and Care partners in a firm, sharing profits in the ration of 2:2:1.Their Capital Accounts stood as Rs. 50,000, Rs. 50,000 and Rs. 25,000 respectively. B died, and balance in the reserve on that date was Rs. 15,000. If goodwill of the firm is Rs. 30,000 and profit on revaluation is Rs. 7,050, what amount will be transferred to B’s Executor’s Account?
(a) Rs. 50,820.
(b) Rs. 70,820.
(c) Rs. 8,820.
(d) Rs. 60,820.

Question. A, B and C are equal partners. C retires. He surrenders 3/5th of his share in favour of A and 2/5th in favour of B. New ratio will be :
(A) 3 : 2
(B) 8 : 7
(C) 7:8
(D) 2 : 3

Question.Retiring partner is compensated by the continuing partners in their
(a) Gaining Ratio.
(b) Capital Ratio.
(c) Sacrificing Ratio.
(d) Profit-sharing Ratio.

Question. A, B and C are equal partners in a firm. B retires and the remaining partners decide to share the profits of the new firm in the ratio of 5 : 4. Gaining ratio will be :
(A) 1 :1
(B) 1 : 2
(C) 2 : 1
(D) 5 : 4

Question.A, B and C are partners sharing profit or loss in the ratio of 3 : 2 : 1. B retires and after B’s retirement A and C agreed to share profit or loss in the ratio of 3 : 2 in future. Their gaining ratio will be :
(A) 3 : 1
(B) 1 : 3
(C) 3:7
(D) None of the above

Question.A, B and C are partners sharing profit or loss in the ratio of 4 : 3 : 2. C retires and after C’s retirement A and B agreed to share profit or loss in the ratio of 4 : 3 in future. Their gaining ratio will be :
(A) 3 : 2
(B) 4 : 3
(C) 3 : 4
(D) 1 : 1

Question.Which of the following statement is correct?
(a) Goodwill at the time of retirement of a partner is credited to remaining Partners’ Capital Accounts in sacrificing ratio.
(b) Goodwill at the time of retirement of a partner is credited to remaining Partners’ Capital Accounts in gaining ratio.
(c) Goodwill at the time of retirement of a partner is debited to remaining Partners’ Capital Accounts in sacrificing ratio.
(d) Goodwill at the time of retirement of a partner to the extent of retiring Partner’s Share is debited to remaining Partners’ Capital Accounts in gaining ratio.

Question.Revaluation Account is prepared to give effect to
(a) change in value of assets alone.
(b) change in value of liabilities alone.
(c) undistributed profits and losses.
(d) change in the values of assets and liabilities.

Question. A, B and C were partners sharing profits in the ratio of 4:5:3. C died and remaining partners decided to share profits in the ratio of 7:8, the gaining ratio will be.
(a) 8:7
(b) 4:5.
(c) 1:1.
(d) 2:1..

Question.A, B and C are partners sharing profits in the ratio of 1/4 : 3/10 : 9/20. The New ratio on the retirement of C will be :
(A) 6:5
(B) 5:6
(C) 4 : 3
(D) 4 : 10

Question.X, y and Z have been sharing profits in the ratio of 4 : 2 : 1 Z retires. X and Y take Z’s share equally. New profit sharing ratio will be :
(A) 5 : 2
(B) 5 : 3
(C) 9 : 5
(D) 4 : 2

Question.P, Q and R have been sharing profits and losses in the ratio of 5 : 3 : 2. Q retires. His share is taken by P and R in the ratio of 2 : 1. New profit sharing ratio will be:
(A)6:4
(B)7:3
(C) 7 : 2
(D) 6 : 3

Question. A, B and C were partners, sharing profit and losses in the ratio of 3:2:1. B died, the firm decided to value the goodwill on the basis of 3 years’ purchase of average of 5 years profits. The profits of the firm for the last five years before charging interest on capital were Rs. 11,000, Rs. 9,000, Rs. 11,000, Rs. 7,000 and Rs. 8,000. The capital of the firm stood at Rs. 50,000 and interest rate is 8%. Value of goodwill will be
(a) Rs. 10,000.
(b) Rs. 15,600.
(c) Rs. 21,000.
(d) Rs. 11,000

Question.The Partnership Deed does not have a clause on rate of interest to be paid on amount due to heirs of deceased partner. At what rate interest on the outstanding amount shall be payable?
(a) At the rate at which the banks grant loan.
(b) At the rate of interest provided ¡n the Partnership Act, 1932.
(c) At the rate of interest demanded by the heirs of the deceased partner.
(d) 8% p.a.

Question.On the death of a partner, his share in the profits of the firm till the date of his death is transferred to the
(a) Debit of Profit and Loss Account
(b) Credit of Profit and Loss Account.
(c) Debit of Profit and Loss Suspense Account.
(d) Credit of Profit and Loss Suspense Account

Question.A, Band Care partners sharing profit and losses in the ratio of 2:2:1.B died, at that time goodwill of the firm valued at Rs. 30,000. What contribution has to be made by A and C in order to pay B’s Executor?
(a) Rs. 20,000 and Rs. 10,000.
(b) Rs. 15,000 and Rs. 15,000.
(c) Rs. 8,000 and Rs. 4,000.
(d) Rs. 6,000 and Rs. 6,000.

Question.X, Y and Z were partners sharing profits in the ratio of 2:2:1. Y died on 30th June, 2020 and profit for the accounting year ended 31st March, 2020 was Rs. 36,000. If profit share of deceased partner is to be calculated on the basis of previous year’s profit, amount of profit credited to Y’s Capital Account will be
(a) Rs. 3,000.
(b) Rs. 2,400.
(c) Rs. 3,600.
(d) Rs. 2,800.

Question.How goodwill is recorded on the retirement of a partner?
(A) Remaining Partner’s Capital A/cs Dr. (In Gaining Ratio) To Retiring Partner’s Capital A/c (with his share of goodwill)
(B) Remaining Partner’s Capital A/cs Dr. (In New Ratio) To Retiring Partner’s Capital A/c (with his share of goodwill)
(C) Goodwill A/c Dr. To All Partner’s Capital A/cs (In Old Ratio)
(D) Goodwill A/c Dr. To Retiring Partner’s Capital A/c (with his share)

Question.Choose the odd one:
(a) Revaluation Account
(b) Realisation of assets.
(c) Adjustment of goodwill.
(d) Gaining ratio.

 

Question.P, Q and R are partners sharing profits in the ratio of 4 : 3 : 2.Q retires and his share was taken up by P and R in the ratio 3 : 2. New profit sharing ratio will be: 
(A) 16 : 29
(B) 29 : 16
(C) 3 : 2
(D) 2 : 3

Question.L, P and G are three partners sharing profits in the ratio 15 : 9 : 8. G retires. L and P decided to share profits in equal ratio. Gaining ratio will be :
(A) 15: 9
(B) 9:15
(C) 7 : 1
(D) 1 : 7

Question.On retirement of a partner, goodwill will be credited to the Capital Account of:
(A) Retiring Partner
(B) Remaining Partners
(C) All Partners
(D) None of the Above

Question. On the death of a partner, the amount due to him will be credited to :
(A) All partner’s Capital Accounts
(B) Remaining partner’s Capital Accounts
(C) His Executor’s Account
(D) Governments’ Revenue Account

Question. Sacrificing ratio is used to distribute —————— in case of admission of a partner.
(a) Goodwill
(b) Revaluation Profit or Loss
(c) Profit and Loss Account (Credit Balance)
(d) Both b and c

Question. Himanshu and Naman share profits & losses equally. Their capitals were Rs.1,20,000 and Rs. 80,000 respectively. There was also a balance of Rs. 60,000 in General reserve and revaluation gain amounted to Rs. 15,000. They admit friend Ashish with 1/5 share. Ashish brings Rs.90,000 as capital. Calculate the amount of goodwill of the firm.
(a) Rs.1,00,000
(b) Rs. 85,000
(c) Rs.20,000
(d) None of the above

Question. Yash and Manan are partners sharing profits in the ratio of2:1. They admit Kushagra into partnership for 25% share of profit. Kushagra acquired the share from old partners in the ratio of 3:2. The new profit sharing ratio will be:
(a) 14:31:15
(b) 3:2:1
(c) 31:14:15
(d) 2:3:1

Question. Aryaman and Bholu are partners sharing profit and losses in ratio of 5:3. Chirag is admitted for 1/4th share. On the date of reconstitution, the debtors stood at Rs 40,000, bill receivable stood at Rs. 10,000 and the provision for doubtful debts appeared at Rs. 4000. A bill receivable, of Rs 10,000 which was discounted from the bank, earlier has been reported to be dishonored. The firm has sold, the debtor so arising to a debt collection agency at a loss of 40%. If bad debts now have arisen for Rs 6,000 and firm decides to maintain provisions at same rate as before then amount of Provision to be debited to Revaluation Account would be:
(a) Rs 4,400
(b)Rs 4,000
(c) Rs.3,400
(d) None of the above

Question. If at the time of admission if there is some unrecorded liability, it will be ————- to — ———— Account.
(a) Debited, Revaluation
(b) Credited, Revaluation
(c) Debited, Goodwill
(d) Credited, Partners’ Capital

Question. Which of the following is not the reconstitution of partnership?
(a) Admission of a partner
(b) Dissolution of Partnership
(c) Change in Profit Sharing Ratio
(d) Retirement of a partner

Question. On the admission of a new partner:
(a) Old partnership is dissolved
(b) Both old partnership and firm are dissolved
(c) Old firm is dissolved
(d) None of the above

Question. Heena and Sudha share Profit & Loss equally. Their capitals were Rs.1,20,000 and Rs. 80,000 respectively. There was also a balance of Rs. 60,000 in General reserve and revaluation gain amounted to Rs. 15,000. They admit friend Teena with 1/5 share. Teena brings Rs.90,000 as capital. Calculate the amount of goodwill of the firm.
(a) Rs.85,000
(b) Rs.1,00,000
(c) Rs.20,000
(d) None of the above

Question. Which of the following is not true with respect to Admission of a partner?
(a) A new partner can be admitted if it is agreed in the partnership deed.
(b) If all the partners agree, a new partner can be admitted.
(c) A new partner has to bring relatively higher capital as compared to the existing partners
(d) A new partner gets right in the assets of the firm

Question. As per ———, only purchased goodwill can be shown in the Balance Sheet.
(a) AS 37
(b) AS 26
(c) Section 37
(d) AS 37

Question. A and B are partners sharing profit and losses in ratio of 5:3. C is admitted for 1/4th share. On the date of reconstitution, the debtors stood at Rs 40,000, bill receivable stood at Rs. 10,000 and the provision for doubtful debts appeared at Rs. 4000. A bill receivable, of Rs 10,000 which was discounted from the bank, earlier has been reported to be dishonored. The firm has sold, the debtor so arising to a debt collection agency at a loss of 40%. If bad debts now have arisen for Rs 6,000 and firm decides to maintain provisions at same rate as before then amount of Provision to be debited to Revaluation Account would be:
(a) Rs 4,400
(b) Rs 4,000
(c) Rs 3,400
(d) None of the above

Question. A, and B are partners sharing profits in the ratio of 2:3. Their balance sheet shows machinery at ₹2,00,000; stock ₹80,000, and debtors at ₹1,60,000. C is admitted and the new profit sharing ratio is 6:9:5. Machinery is revalued at ₹1,40,000 and a provision is made for doubtful debts @5%. A’s share in loss on revaluation amount to ₹20,000. Revalued value of stock will be:
(a) ₹62,000
(b) ₹1,00,000
(c) ₹60,000
(d) ₹98,000

Question. At the time of admission of a partner, Employees Provident Fund is:
(a) Distributed to partners in the old profit sharing ratio
(b) Distributed to partners in the new profit sharing ratio
(c) Adjusted through gaining ratio
(d) None of the above

Question. At the time of admission of a new partner, the balance of Workmen Compensation Reserve will be transferred to:
(a) Old partners in the old profit sharing ratio
(b) Sacrificing partners in the sacrificing ratio
(c) Revaluation Account
(d) All partners in the new profit sharing ratio

Question. Which statement is true with respect to AS-26?
(a) Purchased goodwill can be shown in the Balance Sheet
(b) Revalued goodwill can be shown in the Balance Sheet
(c) Both purchased goodwill and revalued can be shown in the Balance Sheet
(d) None of the above

Question. Premium brought by newly admitted partner should be:
(a) Credited to sacrificing partners
(b) Credited to all partners in the new profit sharing ratio
(c) Credited to old partners in the old profit sharing ratio
(d) Credited to only gaining partners

Question. The firm of P, Q and R with profit sharing ratio of 6:3:1, had the balance in General Reserve Account amounting Rs. 1,80,000. S joined as a new partner and the new profit sharing ratio was decided to be 3:3:3:1. Partners decide to keep the General Reserve unchanged in the books of accounts. The effect will be:
(a) P will be credited by Rs. 54,000
(b) P will be debited by Rs. 54,000
(c) P will be credited by Rs. 36.000
(d) P will be credited by Rs. 36,000

Question. Revaluation Account is a ———— Account.
(a) Real
(b) Nominal
(c) Personal
(d) Liability

Q. 21 Sacrificing ratio is calculated because:
(a) Profit shown by Revaluation Account can be credited to sacrificing partners
(b) Goodwill brought in by the incoming partner can be credited to the new partner
(c) Goodwill brought in by the incoming partner can be credited to the sacrificing partners
(d) Both a and c

Question. Gaining ratio is used to distribute —————— in case of retirement of a partner.
(a) Goodwill
(b) Revaluation Profit or Loss
(c) Profit and Loss Account (Credit Balance)
(d) Both b and c

Question. X, Y and Z are partners in a firm. Y retires and his claim including his capital and his share of goodwill is R. 1,20,000. He is paid partly in cash and partly in kind. A vehicle at Rs. 60,000 unrecorded in the books of the firm and the balance in cash is given to him to settle his account. The amount of cash to be paid to Y will be:
(a) Rs. 80,000
(b) Rs. 60,000
(c) Rs. 40,000
(d) Rs. 30,000

Question. A and B were partners. They shared profits as A- ½; B- 1/3 and carried to reserve 1/6. B died. The balance of reserve on the date of death was Rs. 30,000. B’s share of reserve will be:
(a) Rs. 10,000
(b) Rs. 8,000
(c) Rs. 12,000
(d) Rs. 9,000

We hope you liked MCQ Class 12 Accountancy Chapter 4 Reconstitution Of A Partnership Firm – Retirement/Death Of A Partner with answers provided above. Incase you have any questions please post them in the comments section below and our Accountancy teachers will provide a response. Also read DK Goel Class 12 Solutions