CUET Assertion Reason MCQs of Retirement of Partner with Answers
Looking for Assertion Reason MCQs of Retirement of Partner of Accountancy class 12 for CUET, CBSE, ISC, and State Board Examination.
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Assertion Reason Multiple Choice Questions of Retirement of Partner with answers
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Assertion (A): Retirement of partner means partnership comes to an end and new partnership becomes operative.
Reason (R): Retirement of a partner is the reconstitution of partnership and the firm continues.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- a)
Assertion (A): Retirement of a partner results into dissolution of partnership and new partnership among the remaining partners comes into existence.
Reason (R): Retirement of a partner results into reconstitution of partnership.
In the context of the above two statements, which of the following is correct?
Codes:
(a) (A) and (R) both are correct and (R) correctly explains (A)
(b) Both (A) and (R) are correct but (R) does not explain (A)
(c) Both (A) and (R) are incorrect
(d) (A) is correct but (R) is incorrect
Ans:- a)
Assertion (A): Retiring partner will get his share in the firm’s gain (profit) on revaluation of assets and reassessment of liabilities and will bear the loss on revaluation.
Reason (R): Retiring partner is entitled to share in profit and bear loss, if any, up to the date of retirement.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- a)
Assertion (A): In the event of retirement of a partner, the combined share of profit of the remaining partners will increase.
Reason (R): Combined share of profit of the remaining partners increases because they will also acquire the profit share of the retiring partner.
In the context of the above two statements, which of the following is correct?
Options:
(a) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
(b) Both (A) and (R) are true and (R) is the correct explanation of (A)
(c) (A) is false but (R) is true
(d) (A) is true but (R) is false
Ans:- b)
Assertion (A): Retiring partner will not get share in firm’s goodwill on his retirement from the firm.
Reason (R): Retiring partner is entitled to his share in firm’s goodwill since he has forgone his share in the profits of the firm in favour of other partners.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- d)
Assertion (A): If A, B, C and D are partners, D’s son will automatically become the new partner in case of D’s death.
Reason (R): D’s son will become the new partner only if majority of the remaining partners agree to admit him into partnership.
In the context of the above two statements, which of the following is correct?
Options:
(a) Both (A) and (R) are correct and (R) is the correct reason of (A)
(b) Both (A) and (R) are correct but (R) is not the correct reason of (A)
(c) Only (R) is correct
(d) Both (A) and (R) are wrong.
Ans:- d)
Assertion (A): At the time of retirement, the retiring partner will get an amount equal to his share in profits out of general reserve and credit balance in Profit and Loss Account.
Reason (R): Retiring partner will not get an amount out of the General Reserve and credit balance of the Profit and Loss Account at the time of his retirement since he gets his share in goodwill.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- c)
Assertion (A): In case of retirement of a partner, goodwill is credited to all partners Capital accounts in old ratio.
Reason (R): In case of retirement of a partner, his share of goodwill is credited to retiring partner’s capital account and debited to continuing partners in their sacrificing ratio.
In the context of the above two statements, which of the following is correct?
Options:
(a) Both (A) and (R) are correct and (R) is the correct reason of (A)
(b) Both (A) and (R) are correct and (R) is not the correct reason of (A)
(c) Only (R) is correct
(d) Both (A) and (R) are wrong
Ans:- d)
Assertion (A): At the time of retirement of a partner, besides the Retiring Partner, if a continuing partner also sacrifices his profit share, he along with the retiring partner will get a share in the firm’s goodwill equal to the profit share sacrificed.
Reason (R): Goodwill is paid by the Gaining Partners to the Sacrifice Partners for sacrificing their profit share.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- a)
Assertion (A): At the time of retirement, the retiring partner is entitled to get his share of general reserve and credit balance in Profit & Loss Account.
Reason (R): Retiting partner is not entitled to share of general reserve and credit balance in Profit & Loss Account since he gets his share of goodwill.
In the context of the above two statements, which of the following is correct?
Options:
(a) Both (A) and (R) are true, but (R) is not the correct explanation of (A).
(b) Both (A) and (R) are true and (R) is the correct explanation of (A)
(c) Both (A) and (R) are false
(d) (A) is true, but (R) is false
Ans:- d)
Assertion (A): At the time of retirement of a partner, the combined profit share of the remaining or continuing partners increases.
Reason (R): Remaining or continuing partners take a part of profit share of the retiring partner as a result their individual profit share increases.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- b)
Assertion (A): In the event of death of a partner, in case there is no change in the profit sharing ratio of continuing partners, the deceased partner’s share of profit till the date of his death is debited to Profit & Loss Suspense Account.
Reason (R): Profit and Loss Suspense Account is closed by transferring its balance to Profit & Loss Account.
In the context of the above two statements, which of the following is correct?
Options:-
(a) (A) and (R) both are correct and (R) correctly explains (A)
(b) Both (A) and (R) are correct but (R) does not correctly explain (A)
(c) Both (A) and (R) are incorrect
(d) (A) is incorrect but (R) is correct
Ans:- b)
Assertion (A): At the time of retirement of a partner, assets are revalued and liabilities are reassessed to ensure that the retiring partner is neither at an advantage nor at loss due to change in values of assets and liabilities.
Reason (R): As a principle, assets and liabilities are valued at their current values, and gain (Profit) or loss due to the change be credited or debited to the capital accounts of all the partners (including the retiring partner) since it is for the period before retirement.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- a)
Assertion (A): At the time of retirement of a partner, loss on revaluation is debited to the Capital accounts of remaining partners in their old ratio.
Reason (R): At the time of retirement of a partner, gain on revaluation is credited to the Capital accounts of all partners in their old ratio.
In the context of the above two statements, which of the following is correct?
Options:
(a) Both (A) and (R) are true, but (R) is not the correct explanation of (A)
(b) Both (A) and (R) are true and (R) is a correct explanation of (A)
(c) Both (A) and (R) are false
(d) (A) is false, but (R) is true
Ans:- d)
Assertion (A): The amount due to the retiring partner is always transferred to his Loan Account.
Reason (R): Amount due to the retiring partner may be paid immediately or later in installments.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- d)
Assertion (A): In case of retirement, the retiring partner is entitled to get interest @ 6% p.a. till the amount due to him is paid off.
Reason (R): At his option, the retiring partner, instead of the interest, may take that share of profits which has been earned by the firm by the use of the amount due to him
In the context of the above two statements, which of the following is correct?
Options
(a) Both (A) and (R) is correct and (R) is the correct reason of (A)
(b) Both (A) and (R) is correct but (R) is not the correct reason of (A)
(c) Only (R) is correct.
(d) Both (A) and (R) are wrong.
Ans:- a)
Assertion (A): Sacrificing Ratio is not calculated at the time of retirement of a partner.
Reason (R): At the time of retirement of a partner only the gaining ratio is calculated.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Assertion (A) is not correct but Reason (R) is correct.
Ans:- d)
Assertion (A): Amount due to retiring partner is always transferred to his Loan Account bearing interest @ 6% p.a.
Reason (R): Amount due to retiring partner may be paid immediately or later in instalments with agreed rate of interest.
In the context of the above two statements, which of the following is correct?
Options:
(a) (A) and (R) both are correct and (R) correctly explains (A).
(b) Both (A) and (R) are correct and (R) does not explain (A).
(c) Both (A) and (R) are incorrect.
(d) (A) is incorrect but (R) is correct
Ans:- d)
Assertion (A): At the time of retirement of partners, if the retiring partner is paid more amount than due to him, the difference amount is goodwill paid based on valuation.
Reason (R): Goodwill is not paid by the Gaining Partners to the Sacrificing Partners.
Options:
a) Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
b) Assertion (A) and Reason (R) are correct but Reason (R) is not the correct explanation of Assertion (A).
c) Assertion (A) is correct but Reason (R) is not correct.
d) Both Assertion (A) and Reason (R) are Correct.
Ans:- d)
Assertion (A): On retirement of a partner, if the retiring partner is paid in excess of the total amount due to him, such an excess is treated as his share of goodwill.
Reason (R): Retiring partner’s share of goodwill is recorded by debiting goodwill account and crediting retiring partner’s capital account.
In the context of the above two statements, which of the following is correct?
Options:
(a) Both (A) and (R) are correct and (R) is the correct explanation of (A).
(b) Both (A) and (R) are correct but (R) is not the correct explanation of (A)
(c) Only (A) is correct
(d) Both (A) and (R) are wrong.
Ans:- c)
Assertion (A): A, B and C were partners sharing profits in 4 : 3 : 2 : 1. A retires and new profit sharing ratio between B and C is agreed at 2 : 1. On that date, advertisement suspense account of ₹ 1,80,000 existed in the balance sheet. It will be written off among all partners in old ratio.
Reason (R): Advertisement Suspsense Account is a fictitious asset and at the time of retirement of a partner all fictitious assets are written off to the Capital Accounts of old partners in old profit sharing ratio.
In the context of the above two statements, which of the following is correct?
Options:
(a) Both (A) and (R) are correct and (R) is the correct reason of (A).
(b) Both (A) and (R) are correct but (R) is not the correct reason of (A).
(c) Only (R) is correct.
(d) Both (A) and (R) are wrong.
Ans:- a)
Assertion (A): When Workmen Compensation Reserve appearing in the Balance Sheet is more than the claim against it, the excess of such reserve is credited to old partners in their old profit- sharing ratio.
Reason (R): Workmen Compensation Reserve is a reserve created out of past profits and hence distributed among old partners in their old ratio.
In the context of the above two statements, which of the following is correct?
Option:-
(a) (A) and (R) both are correct and (R) correctly explains (A).
(b) Both (A) and (R) are correct but (R) does not explain (A).
(c) Both (A) and (R) are incorrect.
(d) (A) is correct but (R) is incorrect.
Ans:- a)
