CBSE Class 12 Accountancy Death of A Partner Worksheet Set 01

Question. P, Q and R sharing profit and losses in the ratio of 8:5:3. P retire from the firm, Q takes 3/16 from P and R takes 5/16 from P. New profit-sharing ratio between Q and R will be (A) 1:1
(B) 10:6
(C) 9:7
(D) 5:3
Answer. 1:1

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) Government’s revenue account.
Answer. His Executors A/c

Question. Sam, Tom and Ram were partners in a firm sharing profits in the ratio 1:2:2. On 30th June 2020, Sam died, and the new profit-sharing ratio was 3:2. On Sam’s death, goodwill of the firm was valued at Rs 300000. Calculate the gaining ratio and give journal entry on the treatment of goodwill.
Case: Analyse the case given below and answer the questions that follow: A, K and S were partners in a firm sharing profits in the ratio of 5: 3: 2. Goodwill ap-peared in their books at the value of Rs 60,000. ‘K’ decided to retire from the firm. On the date of his retirement, goodwill of the firm was valued at Rs2,40,000. The new profit-sharing ratio decided among A and S was 2: 3.
Answer. Gaining ratio : Tom = New share – Old share = 3/5-2/5 =1/5 Ram = 2/5 -2/5 = nil Share of goodwill = 300000 x 1/5 = 60000
DATE
PARTICULARS  LF      DEBIT   CREDIT
Toms capital A/c… Dr  60000
To Sam’s capital A/C
(Goodwill adjusted)                60000

Question. How much of the existing goodwill will be transferred to K’s Capital Account?
(A) Rs 18,000
(B) Rs30,000
(C) Rs 12,000
(D) Rs 72,000
Answer. A

Question. What is A’s gaining or sacrificing ratio:
(A) 1/10 Gain
(B) 1/10 Sacrifice
(C) 4/10 Gain
(D) 4/10 Sacrifice
Answer. B

Question. What amount of goodwill will be transferred to K’s capital account as compensated by A and S?
(A)Rs96,000
(B) Rs 72,000
(C) Rs 24,000
(D) Rs18,000
Answer. B

Question. At the time of retirement or death of a partner, the undistributed profits or losses and reserve are distributed among all partners in their old profit-sharing ratio. (True or False)
Answer. True

Question.Provident Fund is credited to all partners in their old ratio at the time of Retirement of a Partner. (True /False)
Answer. False

Question. Name the account which is opened to credit the share of profit of the deceased partner, till the time of his death to his Capital Account?
Answer. Profit and loss suspense A/c

Question. X Y and Z were partners in a firm sharing profit in the ratio ½, 1/3, and 1/6 respectively. Z decided to retire from the firm on the date workman compensation reserve of Rs 120000 was appearing in the balance sheet of the firm. The claim on account of workmen compensation was determined at Rs 67500 excess of amount over the claim will be
a) Debited to revaluation account
b) Credited to revaluation account
c) Debited to partner capital account
d) Credited to partner capital account
Answer. D

Question. A and B were partners sharing profits and losses in ratio 3:2. On April 2018 they decided to admit C for ⅕ th share in the future profits. They had a reserve of 25000, which they wanted to show in their new balance sheet. C agreed and the necessary adjustments were made in the book. On October 1st 2018, A met with an accident and died. B and C de-cided to admit A's Daughter F in their partnership, who agreed to bring Rs. 200000 as capital. Calculate A's share in the reserve on the date of her death.
Answer. A’s share of reserve = Rs 12000
NPSR = 12:8:5
A’s share = 25000 x 12/25 = Rs 12000

Question. The share of goodwill of the retiring partners debited to remaining partners in their ----
a) Capital ratio
b) New ratio
c) Gaining ratio
d) Sacrifice ratio
Answer. A

SHORT ANSWERS:TYPE QUESTIONS

Question. From the following particulars, calculate new profit-sharing ratio of the partners:
(a) Shiv, Mohan and Hari were partners in a firm sharing profits in the ratio of 5:5:4. Mohan retired and his share was divided equally between Shiv and Hari.
(b) P, Q and R were partners sharing profits in the ratio of 5: 4 : 1. P retires from the firm.
Answer. 
a) Old Ratio (Shiv, Mohan and Hari) = 5 : 5 : 4
Mohan’s Profit Share = 5/14
His share is divided between Shiv and Hari equally i.e. in the ratio of 1: 1
Share of Mohan taken by Shiv : 5/14 x ½ = 5/28
Share of Mohan taken by Hari : 5/14 x ½ =5/28
New Profit Share = Old Profit Share + Share taken from Mohan
Shivs new share = 5/14 + 5/28 = 15/28
Hari’s new share = 4/14 + 5/28 = 13/28
∴ New Profit Sharing Ratio (Shiv and Hari) = 15: 13
(b) Old Ratio (P, Q and R) = 5 : 4 : 1
P’s Profit Share = 5/10
Since, no information is given as to how Q and R are acquiring P's profit share after his retirement, so the new profit sharing ratio between Q and R becomes 4 : 1
∴New Profit Ratio (Q and R) = 4 : 1

Question. Kumar, Lakshya, Manoj and Naresh are partners sharing profits in the ratio of 3: 2: 1: 4. Kumar retires and his share is acquired by Lakshya and Manoj in the ratio of 3: 2. Calculate new profit-sharing ratio of the remaining partners. 
Answer. Kumar's share =3/10(acquired by Lakshya and Manoj in 3:2)
Share acquired by Lakshya=3/10×3/5=9/50 Share acquired by Manoj=3/10×2/5=6/50
Lakshya's New Share=2/10+9/50=19/50 Manoj's New Share=1/10+6/50=11/50
Naresh's share (as retained)=4/10 or 20/50 New Profit Sharing Ratio=19:11:20

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Please click on below link to download CBSE Class 12 Accountancy Death of A Partner Worksheet Set A