Class 12 Accountancy MCQs Reconstitution of Partnership Firm
MCQs are given herewith for practice. These questions are not according to the particular level of difficulty or format like theory/numercial. These questions are jumbled to introduce surprise factor for proper practice.
Maintain speed and accuracy for examination success. Do these questions after preparing the chapter and note down the time taken.
- Mitu, Nitu and Geetu were partners sharing profits in the ratio of 2 : 2 : 1. They decided to share future profits in the ratio of 7 : 5 : 3 with effect from 1st April, 2024. Their Balance Sheet as on that date showed a Debit balance of ₹45,000 in Profit and Loss Account. The amount to be debited respectively to their capital accounts in this respect would be:
a) ₹ 15,000, ₹ 15,000 and ₹ 15,000
b) ₹ 21,000, ₹ 15,000 and ₹ 9,000
c) ₹ 22,500, ₹ 22,500 and Nil
d) ₹ 18,000, ₹ 18,000 and ₹ 9,000
2. Meena, Sheena and Teena who are presently sharing profits and losses in the ratio of 5:3:2 decide to share profits and losses in the ratio of 2:3:5 with effect from 1st April 2024. Workmen Compensation Reserve exists at ₹12,000 in the Balance Sheet as at 31st March 2024. At the time of reconstitution, certain amount of claim on Workmen Compensation was determined for which Sheena's share of loss was ₹3,150. The claim for Workman Compensation is:
a) ₹15,000
b) ₹16,000
c) ₹18,000
d) ₹22,500
3. On reconstitution of a firm, Advertisement Suspense Account in the Balance Sheet is:
a) Debited to Revaluation Account
b) Realized in cash
c) Debited to Partners' Capital Accounts in Old Profit-sharing Ratio
d) Credited to Partners Capital Accounts in New Profit-sharing Ratio
4. Any change in the relationship of existing partners which results in an end of the existing agreement and enforces making of new· agreement is called:
a) Revaluation of partnership
b) Realization of partnership
c) Reconstitution of partnership
d) None of the above
5. Reserves and Accumulated profits are transferred to partners ' capital accounts at the time of reconstitution in:
a) Sacrificing Ratio
b) Gaining ratio
c) Old profit-sharing ratio
d) New profit-sharing ratio
Class 12 Accountancy MCQs Reconstitution of Partnership Firm
6. Anuj and Bansi are partners in a firm sharing profits in the ratio of 3 : 2. They decided to share future profits equally. Anuj’s gain or sacrifice would be:
a) 2/10 (sacrifice)
b) 5/10 (gain)
c) 1/10 (Gain)
d) 1/10 (sacrifice)
7. Anu, Banu and Tanu sharing profits and losses in the ratio of 1:2:3, decided to share future profit and losses equally. They also decided to adjust the following balances without affecting their book figures, by passing an adjustment entry:
General Reserve: ₹ 70,000, Profit and Loss A/c: ₹ 60,000, Deferred Revenue Expenditure A/c: ₹ 10,000
That adjustment entry would be:
a) Dr. Anu and Cr. Tanu by ₹ 20,000
b) Dr. Tanu and Cr. Anu by ₹ 20,000
c) Dr. Banu and Cr. Anu by ₹ 20,000
d) Dr. Anu and Cr. Banu by ₹ 20,000
8. A, B and C are partners sharing profits and losses equally. They decide to share the future profits in the ratio of 5:3:2. Workmen compensation reserve is appearing in the balance sheet at ₹20,000. If no further information is available for the same, it should be:
a) Carried forward to new balance sheet without any adjustment
b) Distributed among the partners in new profit-sharing ratio
c) Distributed among the partners in old profit-sharing ratio
d) Distributed among the partners in capital ratio
9. Anjana, Bindu and Cindy were partners in a firm sharing profits in the ratio of 3:4:1. They decided to share profits equally. On that date the profit and loss account showed the credit balance of ₹48,000. Instead of closing the profit and loss account, it was decided to record an adjustment entry reflecting the change in profit sharing ratio. The journal entry would be:
a) Dr. Anjana by ₹2,000; Dr. Bindu by 8,000; Cr. Cindy by ₹10,000
b) Cr. Anjana by ₹2,000; Cr. Bindu by 8,000; Dr. Cindy by ₹10,000
c) Cr. Anjana by ₹8,000; Cr. Bindu by 2,000; Dr. Cindy by ₹10,000
d) Dr. Anjana by ₹8,000; Dr. Bindu by 2,000; Cr. Cindy by ₹10,000
10. Manpreet, Sunpreet and Narinder were partners sharing profits in the ratio of 2 : 2 : 1. They decided to share future profits in the ratio of 7 : 5 : 3 with effect from 1st April, 2024. Their Balance Sheet as on that date showed a balance of ₹ 45,000 in Advertisement Suspense Account. The amount to be debited respectively to their capital accounts for writing off the amount in Advertisement Suspense Account would be:
a) ₹ 18,000, ₹ 18,000 and ₹ 9,000
b) ₹ 15,000, ₹ 15,000 and ₹ 15,000
c) ₹ 21,000, ₹ 15,000 and ₹ 9,000
d) ₹ 22,500, ₹ 22,500 and Nil
Class 12 Accountancy MCQs Reconstitution of Partnership Firm
11. Anne and Binny are partners in a firm Sharing profits and losses in the ratio of 2 : 3 they decided to share future profits and losses equally with effect from 1st April 2024. An extract of their Balance Sheet as at 31st March 2024 showed: Workmen Compensation Reserve ₹40,000. Show the accounting treatment if a claim on account of Workmen’s Compensation is estimated at ₹25,000.
a) Credit A’s Capital A/c by ₹9,000 and B’s Capital A/c by ₹6,000 and Balance showed a balance Workmen’s Compensation Claim at the liabilities side ₹15,000.
b) Credit A’s Capital A/c by ₹6,000 and B’s Capital A/c by ₹9,000 and Balance showed a balance Workmen’s Compensation Claim at the liabilities side ₹25,000.
c) Credit A’s Capital A/c by ₹6,000 and B’s Capital A/c by ₹9,000 and Balance showed Workmen’s Compensation Claim at the liabilities side ₹15,000.
d) Credit A’s Capital A/c by ₹6,000 and B’s Capital A/c by ₹9,000 and Balance showed a balance Workmen’s Compensation Claim at the liabilities side ₹35,000.
12. Binny, Minny and Tinny who were sharing profits and losses in the ratio of 4,3,2 decided to share the future profits and losses in the ratio to 2:3:4 with effect from 1st April 2024. An extract of their Balance Sheet showed on 31st March 2024, Liabilities Workmen Compensation Reserve ₹65,000. At the time of reconstitution, a certain amount of Claim on workmen compensation was determined for which Minny’s share of loss amounted to₹5,000. The Claim for workmen compensation would be:
a) ₹15,000
b) ₹70,000
c) ₹80,000
d) 580,000
13. Ramesh, Rajesh and Raghav were partners sharing profits and losses in the ratio 5:3:2. With effect from 1st April 2024 they decided to share future profits and losses in different ratio. On that date profit and loss account appearing on the asset side of the balance sheet was ₹ 4,00,000 and following entry was passed:
Ramesh’s Capital A/c Dr. ₹ 25,000
To Rajesh’s Capital A/c ₹ 5,000
To Raghav’s Capital A/c ₹ 20,000
Find new Ratio.
a) 45 : 23 : 12
b) 7 : 5 : 4
c) 2 : 1 : 1
d) 1 : 1 : 1
14. Aman, Boman and Chaman are partners in a firm Sharing profits and losses in the ratio of 4 : 3 : 2. They decided to share future profits and losses in the ratio of 2 : 3 : 4 with effect from 1st April 2024. An extract of their Balance Sheet as at 31st March 2024 showed: Investment Fluctuation Reserve ₹54,000 and Investment (at cost) ₹6,00,000. The accounting treatment If the market value of the Investment is ₹5,91,000, would be:
a) Credit Aman’s Capital A/c by ₹10,000, Boman’s Capital A/c by ₹10,000 and Chaman’s Capital A/c by ₹10,000.
b) Credit Aman’s Capital A/c by ₹3,000, Boman’s Capital A/c by ₹3,000 and Chaman’s Capital A/c by ₹3,000.
c) Credit Aman’s Capital A/c by ₹20,000, Boman’s Capital A/c by ₹15,000 and Chaman’s Capital A/c by ₹10,000.
d) Credit Aman’s Capital A/c by ₹25,000, Boman’s Capital A/c by ₹15,000 and Chaman’s Capital A/c by ₹10,000.
15. Red, Blue and Green are partners sharing profits and losses in the ratio of 2 : 5 : 5. From 1st April 2024 they decided to share profit and losses in the ratio of 3 : 5 : 7. If Adjustment of goodwill for this purpose results in Crediting Blue’s Capital A/c with ₹ 90,000 then complete journal entry would involve:
a) Red’s Capital A/c Dr. ₹40,000, Green’s Capital A/c Dr. ₹ 50,000, To Blue’s Capital A/c ₹90,000
b) Red’s Capital A/c Dr. ₹36,000, Green’s Capital A/c Dr. ₹54,000, To Blue’s Capital A/c ₹90,000
c) Red’s Capital A/c Dr. ₹30,000, Green’s Capital A/c Dr. ₹ 60,000, To Blue’s Capital A/c ₹90,000
d) Red’s Capital A/c Dr. ₹45,000, Green’s Capital A/c Dr. ₹45,000, To Blue’s Capital A/c ₹90,000
Class 12 Accountancy MCQs Reconstitution of Partnership Firm
16. Gurjit, Ajit and Kuljit were partners sharing profits in the ratio of 2: 2: 1. They decided to share future profits in the ratio of 7: 5: 3. with effect from 1st April 2024. Their Balance Sheet as on that date showed a balance of ₹30,000 in Advertisement suspense account. Amount, that will be debited/credited to the Capital accounts of Malika, Ajit and Kuljit if they do not want to change the balance of Advertisement suspense account in Balance Sheet, would be:
a) Gurjit’s Capital Dr. ₹12,000; Ajit’s Capital Dr. ₹12,000 and Kuljit’s Capital Dr. ₹6,000 respectively.
b) Debit ₹10,000 each to all partners’ Capital Accounts.
c) Debit Gurjit's Capital A/c and Credit Ajit’s Capital A/c by ₹2,000 each.
d) Debit Ajit’s Capital A/c and Credit Gurjit’s Capital A/c by ₹2,000.
17. Anita, Sunita and Minka are partners in a firm sharing profits and losses in the ratio of 3:3:2. From 1st April 2024, they decided to share profits and losses in the ratio of 3:2:1. On that date their Balance Sheet showed a Contingency Reserve of ₹1,92, 000. They decided to show Contingency Reserve in the new Balance Sheet. The correct accounting treatment for the above is:
a) Sunita’s capital account will be debited by ₹24,000 and Anita and Minka's capital account will be credited by ₹8,000 and ₹16,000 respectively.
b) Minka’s capital account will be debited by ₹24,000 and Anita and Sunita's capital account will be credited by ₹8,000 and ₹16,000 respectively.
c) Sunita and Minka’s capital account will be debited by ₹8,000 and ₹16,000 respectively and Anita's capital account will be credited by ₹24,000.
d) Anita’s capital account will be debited by ₹24,000 and Sunita and Minka's capital account will be credited by ₹8,000 and ₹16,000 respectively.
Question: 18 and 19 are based on the following text:
Text - X, Y and Z who are sharing profits in the ratio of 5:3:2, decide to share profits in the ratio of 2:3:5 with effect from 1st April 2024 Workmen Compensation Reserve appears at ₹1,20,000 in the Balance Sheet as at 31st March 2024.
18. Workmen Compensation Claim estimated at ₹1,50,000 is shown as:
a) Liability side of the Balance Sheet ₹1,50,000
b) Credited to Partners Capital A/c ₹1,20,000
c) Debited to Revaluation A/c ₹1,50,000
d) Credited to Revaluation A/c ₹1,20,000
19. Workmen Compensation Claim estimated at ₹80,000 is shown as:
a) Credited to Revaluation A/c ₹1,20,000
b) Shown on Liability side of the Balance Sheet ₹1,20,000
c) Debited to Revaluation A/c ₹80,000
d) Workmen’s Compensation claim ₹80,000 shown in the liabilities side of the Balance Sheet & Remaining ₹ 40,000 Credited to Partners’ Capital A/c
20. Assets are revalued, and liabilities are reassessed at the time of change in profit sharing ratio so that:
a) assets and liabilities are shown at their present values
b) no partner is put to an advantage or disadvantage
c) sacrificing partner is partly compensated
d) assets and liabilities are shown at their market value.
More questions will be added from time to time.
Class 12 Accountancy MCQs Reconstitution of Partnership Firm - Answers
- d) ₹ 18,000, ₹ 18,000 and ₹ 9,000
- d) ₹ 22,500
- c) Debited to Partners' Capital Accounts in Old Profit-sharing Ratio
- c) Reconstitution of partnership
- c) Old profit-sharing ratio
- d) 1/10 (sacrifice)
- a) Dr. Anu and Cr. Tanu by ₹ 20,000
- c) Distributed among the partners in old profit-sharing ratio
- b) Cr. Anjana by ₹2,000; Cr. Bindu by 8,000; Dr. Cindy by ₹10,000
- d) ₹ 22,500, ₹ 22,500 and Nil
- b) Credit A’s Capital A/c by ₹6,000 and B’s Capital A/c by ₹9,000 and Balance showed a balance Workmen’s Compensation Claim at the liabilities side ₹25,000.
- c) ₹80,000
- b) 7 : 5 : 4
- c) Credit Aman’s Capital A/c by ₹20,000, Boman’s Capital A/c by ₹15,000 and Chaman’s Capital A/c by ₹10,000.
- b) Red’s Capital A/c Dr. ₹36,000, Green’s Capital A/c Dr. ₹54,000, To Blue’s Capital A/c ₹90,000
- c) Debit Gurjit's Capital A/c and Credit Ajit’s Capital A/c by ₹2,000 each.
- d) Anita’s capital account will be debited by ₹24,000 and Sunita and Minka's capital account will be credited by ₹8,000 and ₹16,000 respectively.
- a) Liability side of the Balance Sheet ₹1,50,000
- d) Workmen’s Compensation claim ₹80,000 shown in the liabilities side of the Balance Sheet & Remaining ₹ 40,000 Credited to Partners’ Capital A/c
- b) no partner is put to an advantage or disadvantage
Class 12 Accountancy MCQs Partnership Basic Concepts