Partnership

Admission

Medium

common

Match List-I with List-II

List-I List-II
(Items to be adjusted on admission) (side of account.)
(A) Existing goodwill (i) Debit of capital account.
(B) Increase in value of assets. (ii) Debit of revaluation account.
(C) Decrease in value of assets. (iii) Credit of revaluation account.
(D) New partner capital. (iv) Credit of capital account.

Choose the correct answer from the options given below:

List-I	List-II
(Items to be adjusted on admission)	(side of account.)
(A) Existing goodwill	(i) Debit of capital account.
(B) Increase in value of assets.	(ii) Debit of revaluation account.
(C) Decrease in value of assets.	(iii) Credit of revaluation account.
(D) New partner capital.	(iv) Credit of capital account.

(A) - (I), (B) - (II), (C) - (III), (D) - (IV)

(A) - (I), (B) - (III), (C) - (II), (D) - (IV)

(A) - (I), (B) - (II), (C) - (IV), (D) - (III)

(A) - (III), (B) - (IV), (C) - (I), (D) - (II)

✅ Correct Option: 2

Looking at each item and identifying the correct accounting treatment on admission of a partner:

(A) Existing goodwill → (i) Debit of capital account

When goodwill appearing in books needs to be written off before admission, the entry is:

Old Partners' Capital A/c Dr (in old ratio)

To Goodwill A/c

The existing goodwill is adjusted by debiting old partners' capital accounts.

(B) Increase in value of assets → (iii) Credit of revaluation account

When assets are revalued and their value increases, the entry is:

Asset A/c Dr

To Revaluation A/c

The increase in asset value is credited to revaluation account (treated as gain).

(C) Decrease in value of assets → (ii) Debit of revaluation account

When assets are revalued and their value decreases, the entry is:

Revaluation A/c Dr

To Asset A/c

The decrease in asset value is debited to revaluation account (treated as loss).

(D) New partner capital → (iv) Credit of capital account

When new partner brings in capital, the entry is:

Bank/Cash A/c Dr

To New Partner's Capital A/c

The capital contribution is credited to new partner's capital account.

The correct matching is: (A) - (i), (B) - (iii), (C) - (ii), (D) - (iv)

Option 2 is correct.

2025: 31 May Shift 1

Rohit and Mohit are partners in a firm sharing profits in the ratio of 5:3. They admit Bijoy as a new partner for 1/7th share in the profits. The new profit sharing ratio will be 4:2:1. The sacrificing ratio of Rohit and Mohit is-

2025: 26 May Shift 2

Arrange the Following Steps to Calculate Goodwill under the Super Profits Method-

(A) Calculate the normal profit on the firm's capital on the basis of the normal rate of return

(B) Calculate the average profit

(D) Calculate goodwill by multiplying the super profits by the given number of years' purchase

Choose the correct answer from the options given below:

2025: 26 May Shift 2

Which of the following is not a method of valuation of goodwill?

2022: 8 Aug Shift 2

The goodwill brought in by the new partner is distributed by old partner their:

2023: 29 May Shift 2

Match List I with List II

LIST I	LIST II
A. Loss on Revaluation	I. Credited to old partners in old ratio
B. Profit on Revaluation	II. Debited to profit and loss suspense A/C
C. Premium brought by new partner	III. Credited to old partners in sacrificing ratio
D. On the death of a partner, profit till the date of death is Rs. 2,000	IV. Debited to old partners in the old ratio

Choose the correct answer from the options given below:

2025: 30 May Shift 1

The profits for the five years of a firm are as follows – year 2013 Rs. 4,00,000;year 2014 Rs. 3,98,000; year 2015 Rs. 4,50,000; year 2016 Rs. 4,45,000 and year 2017 Rs. 5,00,000. Calculate the goodwill of the firm on the basis of a 4-year purchase of 5 years average profits:

Solution

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