ASSISI CONVENT SCHOOL, NOIDA

UNIT TEST

CLASS XII

ACCOUNTANCY

TIME: 2 HRS M.M.50

General instructions: Q.No. 1-4 carries one mark each; Q.No 5-9 carries six marks;
Q.No. 10-11 carries eight marks each.

1. Give one difference between Profit and Loss Account and Profit and Loss
Appropriation Account.
2. What is the maximum limit of partners in a partnership firm? Name the Act under
which it is provided.
3. X, Y and Z, who are presently sharing profits and losses in the ratio of 5:3:2, decide
to share future profits and losses in the ratio of 2:3:5.Give journal entry to distribute
Investment Fluctuation Reserve of Rs. 40,000 at the time of change in profit sharing
ratio, when Investment (market value Rs. 1,90,000) appears at Rs. 2,00,000
4. X, Y and Z decide that interest on partners loan to firm should be allowed @ 10%.
But after one year, Z wants that no interest should be allowed on loan by partner.
Can he do so?
5. A, B,C and D were partners sharing profits in the ratio of 3:3:2:2. On 1st April, 2016,
D retired owing to ill health. It was decided by A, B and C that in future their profit-
sharing ratio would be 3:2:1. Goodwill of the firm is valued at Rs. 6,00,000.
Goodwill already appearing in the Balance sheet at Rs. 50,000. Pass the necessary
journal entries.
6. Average Profit Rs. 5,50,000, Capital employed Rs. 10,00,000. Normal Rate of
Return 15%. Remuneration of all the partners during the period is estimated to be Rs.
2,50,000 p.a. Calculate goodwill on the basis of capitalization of average profit and
super profit.
7. A and B are partners sharing profits in the ratio of 3:2 in a firm, which provides
technical services to the industrial firms. They admitted C into the firm for 1/5th
share in the profits. C, an MBA, would help them to expand their business. C is
given a guarantee that his share of profits in any year will not be less than Rs.
5,00,000. Deficiency, if any, would be borne by A and B equally. Loss for the
current year ended on 31st March, 2016, amounted to Rs. 25,00,000. Pass the
necessary journal entries in the books of the firm.
 8. Ravi and Mohan were partners in a firm sharing profits in the ratio of 7:5. Their
respective fixed capital were Rs. 10,00,000 and Rs. 7,00,000. The partnership deed
provided for the following:
a. Interest on capital @12%p.a.
b. Ravis salary Rs. 6,000 p.m. and Mohans salary Rs. 60,000 per year.
The profits for the year ended 31st March, 2016 was Rs. 5,04,000 which was
distributed equally, without providing for the above. Pass an adjustment entry.

9. A, B and C were partners in a firm sharing profits in the ratio of 2:2:1. Their
Balance Sheet as at March 31, 2012 was as follows:
BALANCE SHEET OF FIRM A, B AND C
As at March 31, 2012
Liabilities Amt. Assets Amt.
Creditors 30,000 Land 85,000
Bills Payable 20,000 Building 50,000
Outstanding Expenses 25,000 Plant 1,00,000
General Reserve 50,000 Stock 40,000
Capital: A 50,000 Debtors 25,000
B 60,000 Cash 5,000
C 70,000 1,80,000
3,05,000 3,05,000

From 1st April, 2013 the partners decided to share profits in the ratio of 1:2:3. For this
purpose it was agreed that:

a. The goodwill of the firm should be valued at Rs. 60,000

b. Land should be revalued at Rs. 1,00,000. Building should be depreciated by 6%.
c. Creditors amounting to Rs. 3,000 were not to be paid.
You are required to prepare the capital account of the partners after considering the
changes in the profit sharing ratio.

10. The Balance Sheet of X, Y and Z who were sharing profits in the ratio of 5:3:2 as at 31st
March, 2015.

Liabilities Rs. Assets Rs.

Creditors 50,000 Cash at Bank 40,000
Employees Provident Fund 10,000 Sundry Debtors 1,00,000
Workmen Compensation Reserve 50,000 Stock 80,000
Profit and Loss A/c 85,000 Fixed Assets 60,000
Xs Capital 40,000 Goodwill 50,000
Ys Capital 62,000
 Zs Capital 33,000
3,30,000 3,30,000

X retired on the same date on the following terms:

a. Goodwill of the firm is to be valued at Rs. 80,000 and Xs share of the same be adjusted
to that of Y and Z who are going to share the future profits in the ratio of 2:3.
b. Fixed Assets are to be depreciated to Rs. 57,500.
c. Make a provision for doubtful debts at 5% on debtors.
d. A liability for claim, included in creditors for Rs. 10,000 is settled at Rs. 8,000.
e. The amount to be paid to X by Y and Z is such a way that their capitals are proportionate
to their profit sharing ratio and leave a balance of Rs. 15,000 in the bank account. X
decided to donate 50% of his share to a school.
Prepare Revaluation Account, Partners Capital Accounts and Balance Sheet of new firm.

11. D and E were partners in a firm sharing profits in 3:1 ratio. On 1-4-2015 they
admitted F as a new partner for 1/4th share in the firm which he acquired from D.
Their Balance Sheet as at that date was as follows:
Liabilities Rs. Assets Rs.
Creditors 54,000 Land and Building 50,000
Capitals: Machinery 60,000
D 1,00,000 Stock 15,000
E 70,000 Debtors 40,000
General Reserve 32,000 Less: Provision for
bad debts 3,000 37,000
Investments 50,000
Cash 44,000
2,56,000 2,56,000

F will bring Rs. 40,000 as his capital and the other terms agreed upon were:
a. Goodwill of the firm was valued at Rs. 24,000.
b. Land and Building were valued at Rs. 70,000.
c. Provision for bad debts was found to be in excess by Rs. 800
d. A liability for Rs. 2,000 included in creditors was not likely to arise.
e. The capital of the partners be adjusted on the basis of Fs contribution of capital to the
firm.
f. Excess or shortfall, of any, to be transferred to current accounts.

Prepare Revaluation Account, Partners Capital Accounts and the Balance Sheet of the
new firm.