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1.

A B and C are partners sharing profits in the ratio of 5:3:2. They decide to share the future in the ratio of 2 3:5. What will be the accounting treatment of Workmen Compensation Reserve appearing in the Balance Sheet on that date when no information is available for the same?A. Distributed among the partners in their capital ratioB. Distributed among the partners in their new profit-sharing ratio.C. Distributed among the partners in their old profit-sharing ratio.D. Carried forward to new Balance Sheet.

Answer» Correct Answer - C
Discussion
2.

X Y and Z are partners sharing profits in the ratio of 5 : 3:2. They decide to share future profit in the ratio of 2 : 3 :5 with effect from 1st April, 2019. They also decide to record the effect following revaluations without affecting the book values of assets and liabilities, by passing an adjusting entry: The necessary adjustment enrty will beA. Dr. Z and Cr. X by ₹27,000B. Dr.X and Cr.Z by ₹27,000C. Dr. X and Cr. Z by ₹27,000.D. Dr.Xand Cr.Y by ₹27,000

Answer» Correct Answer - A
Discussion
3.

X and Y shared profits and losses in the ratio of 3 :2. With effect from 1st April, 2019 they agre share profits equally. The goodwill of the firm was valued at ₹60,000. The adjustment entry will be :A. Dr.Yand Cr.X with ₹6,000.B. Dr.Xand Cr.Ywith ₹600.C. Dr.Xand Cr. Y with ₹6,000.D. Dr.Yand Cr.X with ₹600

Answer» Correct Answer - A
Discussion
4.

A, B and Care partners sharing profits in the ratio of 5:3:2.They decided to share future profits ratio of 2:3:5with effect from 1st April, 2019.They also decided to adjust the following accumulated profits, losses and reserves without affecting their book values, by passing an adjustment entry. `{:(,,"Book Values" (₹)),("Profit and Loss Account",,15000),("General Reserve",,60000),("Advertising Suspense Account",,3000):}` The necesary adjustment entry will be:A. Dr. C and Cr. A with ₹13,500.B. Dr.A and Cr.C with ₹13,500.C. Dr.Band Cr.A with ₹13,500.D. Dr.A and Cr.B with ₹13,500.

Answer» Correct Answer - A
Discussion