Important MCQs of Change in Profit Sharing Ratio (Class 12 Accountancy)

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Looking for important MCQs of Change in Profit Sharing Ratio chapter of Accountancy class 12 CBSE, ISC and State Board.

We have compiled a huge list of very important Multiple Choice Questions of Change in Profit Sharing Ratio chapter with answers and solutions of Class 12 Accountancy.

Multiple Choice Questions with answers of Change in Profit Sharing Ratio chapter of Class 12 Accountancy

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Sacrificing Ratio:

a) New Ratio – Old Ratio
b) Old Ratio – New Ratio
c) Old Ratio – Gaining Ratio
d) Gaining Ratio – Old Ratio

Ans – b)

Gaining Ratio:

a) New Ratio – Sacrificing Ratio
b) Old Ratio – Sacrificing Ratio
c) New Ratio – Old Ratio
d) Old Ratio – New Ratio

Ans – c)

A and B were partners in a firm sharing profit or loss equally. With effect from 1st April, 2019 they agreed to share profits in the ratio
of 4:3. Due to change in profit sharing ratio, A’s gain or sacrifice will be:

a) Gain 1/4
b) Sacrifice 1/14
c) Gain 4/7
d) Sacrifice 3/7

Ans – a)

A and B were partners in a firm sharing profit or loss equally. With effect from 1st April, 2019 they agreed to share profits in the ratio of
4:3. Due to change in profit sharing ratio, B’s gain or sacrifice will be:

a) Gain 1/14
b) Sacrifice 1/14
c) Gain 4/7
d) Sacrifice 3/7

Ans – b)

A and B were partners in a firm sharing profit or loss in the ratio of 3:5. With effect from 1st April, 2019, they agreed to share profits or
losses equally. Due to change in profit sharing ratio, A’s gain or sacrifice will be:

a) Gain 3/8
b) Gain 1/8
c) Sacrifice 3/8
d) Sacrifice 1/8

Ans – b)

A and B were partners in a firm sharing profits and losses in the ratio of 2:1. With effect from 1st January, 2019 they agreed to share
profits and losses equally. Individual partner’s gain or sacrifice due to change in the ratio will be:

a) Gain by A 1/6, Sacrifice by B 1/6
B) Sacrifice by A 1/6, Gain by by B 1/6
c) Gain by A 1/2, Sacrifice by B 1/2
d) Sacrifice by A 1/2, Gain by B 1/2

Ans – b)

A and B share profits and losses in the ratio of 3:2. With effect from 1st January, 2019, they agreed to share profits equally. Sacrificing
ratio and Gaining Ratio will be:

a) Sacrifice by A 1/10, Sacrifice by B 1/10
b) Gain by A 1/10, Gain by B 1/10
c) Sacrifice by A 1/10, Gain by B 1/10
d) Gain by A 1/10, Sacrifice by B 1/10

Ans – c)

A and B were partners in a firm sharing profit or loss in the ratio of 3:1. With effect from Jan. 1, 2019 they agreed to share profit or loss
in the ratio of 2:1. Due to change in profit & Loss sharing ratio, B’s gain or sacrifice will be:

a) Gain 1/12
b) Sacrifice 1/12
c) Gain 1/3
d) Sacrifice 1/3

Ans – a)

A, B and C were partners sharing profit or loss in the ratio of 7:3:2. From Jan 1, 2019 they decided to share profit or loss in the ratio
of 8:4:3. Due to change in the profit sharing ratio, B’s gain or sacrifice will be:

a) Gain 1/60
b) Sacrifice 1/60
c) Gain 2/10
d) Sacrifice 3/60

Ans – a)

X, Y and Z are partner in a firm sharing profits and losses in the ratio of 5:3:2. The partners decide to share future profits and losses
in the ratio of 3:2:1. Each partner’s gain or sacrifice due to change in the ratio will be:

a) X sacrifice 1/30, Y gain 1/30, Z nil
b) X Gain 1/30, Y Nil, Z sacrifice 1/30
c) X Nil, Y Sacrifice 1/30, Z Gain 1/30
d) X Nil, Y Gain 1/30, Z sacrifice 1/30

Ans – d)

A, B and C were partners in a firm sharing profits and losses in the ratio of 3:2:1. The partners decide to share future profits and losses in
the ratio of 2:2:1. Each partner’s gain or sacrifice due to change in ratio will be:

a) Sacrifice A 3/20, Gain A 2/30, Gain C 1/30
b) Gain A 2/30, Gain B 1/30, Sacrifice C 3/30
c) Sacrifice A 3/30, Gain B 1/30, Gain C 2/30
d) Gain A 1/30, Gain B 1/15, Sacrifice C 1/10

Ans – a)

A, B and C were partners in a firm sharing profits and losses in the ratio of 4:3:2. The partners decide to share future profits and losses in the ratio
of 2:2:1. Each partner’s gain or sacrifice due to change in the ratio will be:

a) Sacrifice A 2/45, Sacrifice B 1/45, Gain C 3/45
b) Gain A 2/45, Sacrifice B 3/45, Gain C 1/45
c) Sacrifice A 2/45, Gain B 3/45, Sacrifice C 1/45
d) Gain A 2/45, Gain B 1/45, sacrifice C 3/45

Ans – c)

A, B and C were partners in a firm sharing profits in 4:3:2 ratio. They decided to share future profits in 4:3:1 ratio. Sacrificing ratio and
gaining ratio will be:

a) A sacrifice 4/72, B Sacrifice 3/72, C gain 7/72
b) A Gain 3/72, B Gain 4/72, C sacrifice 7/72
c) A Sacrifice 3/72, B Sacrifice 4/72, C Gain 7/72
d) A Gain 4/72, B Gain 3/72, C Sacrifice 7/72

Ans – d)

X, Y and Z were partners sharing profits in the ratio 2:3:4 with effect from 1st January, 2019 they agreed to share profits in the ratio
3:4:5. Each partner’s gain or sacrifice due to change in the ratio will be:

a) X Gain 1/36, Y Nil, Z sacrifice 1/36
b) X Sacrifice 1/36, Y Nil, Z Gain 1/36
c) X Gain 1/36, Y Sacrifice 1/36, Z Nil
d) X Sacrifice 1/36, Y Gain 1/36, Z Nil

Ans – a)

X, Y and Z were in partnership sharing profits in the ratio of 4:3:1. The partners agreed to share future profits in the ratio 5:4:3. Each
partner’s gain or sacrifice due to change in ratio will be:

a) X sacrifice 2/24, Y Sacrifice 1/24, Z gain 3/24
b) X Gain 2/24, Y Gain 1/24, Z Sacrifice 3/24
c) X Sacrifice 1/24, Y Sacrifice 2/24, Z Gain 3/24
d) X sacrifice 2/24, Y Gain 3/24; Z Sacrifice 1/24

Ans – a)

A, B and C are equal partners in the firm. It is now agreed that they will share the future profits in the ratio of 5:3:2. Sacrificing ratio
and gaining ratio of different partners will be:

a) A Sacrifice 5/30, B Gain 1/30, C Gain 4/30
b) A Gain 5/30, B Sacrifice 4/30, C Sacrifice 1/30
c) A Gain 5/30, B Sacrifice 1/30, C Sacrifice 4/30
d) A Sacrifice 5/30, B Gain 4/30, C Gain 1/30

Ans – c)

P and Q were partners sharing profits and losses in the ratio of 3:2. They decided that with effect from 1st January, 2019 they would share
profits and losses in the ratio of 5:3. Goodwill is valued at ₹1,28,000. In adjustment entry:

a) Cr. P by ₹3,200, Dr. Q by ₹3,200
b) Cr. P by ₹37,000, Dr. Q by ₹37,000
c) Dr. P by ₹37,000, Cr. Q by ₹37,000
d) Dr. P by ₹3,200, Cr. Q by ₹3,200

Ans – d)

A, B and C are partners sharing profits in the ratio of 4:3:2 decided to share profits equally. Goodwill of the firm is valued at ₹10,800.
In adjusting entry for goodwill:

a) A’s Capital A/c Cr. by ₹4,800; B’s Capital A/c Cr. by ₹3,600;
C’s Capital A/c Cr. by ₹2,400.
b) A’s Capital A/c Cr. by ₹3,600; B’s Capital A/c Cr. by ₹3,600;
C’s Capital A/c Cr. by ₹3,600
c) A’s Capital A/c Dr. by ₹1,200; C’s Capital A/c Cr. by ₹1,200
d) A’s Capital A/c Cr. by ₹1,200; C’s Capital A/c Dr. by ₹1,200

Ans – d)

A, B and C were partners sharing profits and losses in the ratio of 7:3:2. From 1st January, 2019 theyd decided to share profits and losses
in the ratio of 8:4:3. Goodwill is ₹1,20,000. In adjustment entry for goodwill:

a) Cr. A by ₹6,000; Dr B by ₹2,000; Dr. C by ₹4,000
b) Dr. A by ₹6,000; Cr B by ₹2,000; Cr. C by ₹4,000
c) Cr. A by ₹6,000; Dr. B by ₹4,000; Dr. C by ₹2,000
d) Dr. A by ₹6,000; Cr. B by ₹4,000; Cr. C by ₹2,000

Ans – a)

P, Q and R were partners in a firm sharing profits in 5:3:2 ratio. They decided to share the future profits in 2:3:5. For this purpose
the goodwill of the firm was valued at ₹1,20,000. In adjustment entry for the treatment of goodwill due to change in the profit sharing ratio:

a) Cr. P by ₹24,000; Dr. R by ₹24,000
b) Cr. P by ₹60,000; Dr. R by ₹60,000
c) Cr. P by ₹36,000; Dr. R by ₹36,000
d) Dr. P by ₹36,000; Dr. R by ₹36,000

Ans – c)

Avya, Divya and Kavya were equal partners. They decided to change the profit sharing ratio to 4:3:2. For this purpose the goodwill of the firm
was valued at ₹90,000.

The journal entry for the treatment of goodwill on change in profit sharing ratio will be:

a) Kavya’s Capital A/c Dr. 10,000
To Avya;s Capital A/c 10,000
b) Divya’s Capital A/c Dr. 10,000
To Avya’s Capital A/c 10,000
c) Avya’s Capital A/c Dr. 90,000
To Kavya’s Capital A/c 90,000
d) Avya’s Capital A/c Dr. 10,000
To Kavya’s Capital A/c 10,000

Ans – d)

Red, Blue and White were partners in a firm sharing profits in the ratio of 1:2:2. They decided to share future profits in the ratio of
7:5:3 with effect from 1st April, 2019. Their Balance Sheet as on that date showed a balance of ₹22,500 in Deferred Revenue Expenditure
Account. The amount to be debited respectively to the capital accounts of Red, Blue and White for writing off Deferred Revenue Expenditure
will be:

a) ₹7,500, ₹7,500 and ₹7,500
b) ₹4,500, ₹9,000 and ₹9,000
c) ₹10,500, ₹7,,500 and ₹4,500
d) ₹11,250, Nil and ₹11,250

Ans – b)

A, B and are partners in a firm sharing profits in the ratio of 3:4:1. They decided to share profits equally w.e.f 1st April, 2019. On that
date the Profit and Loss Account showed the credit balance of ₹96,000. Instead of closing the Profit and Loss Account, it was decided to record
an adjusting entry reflecting the change in profit sharing ratio. In the Journal entry:

a) Dr. A by ₹4,000: Dr. B by ₹16,000; Cr C by ₹20,000
b) Cr. A by ₹4,000; Cr B by ₹16,000: Dr C by ₹20,000
c) Cr. A by ₹16,000: Cr B by ₹4,000; Dr. C by ₹20,000
d) Dr. A by ₹16,000; Dr B by ₹4,000; Cr. C by ₹20,000

Ans – b)

A, B and C are partner sharing profits in the ratio of 1:2:3. On 1-4-2019 they decided to share the profits equally. On the date there was
a credit balance of ₹1,20,000 in their Profit and Loss Account and a balance of ₹1,80,000 in General Reserve Account. Instead of closing the
General Reserve Account and Profit and Loss Account, It is decided to record an adjusting entry for the same. In the necessary adjustment
entry to give effect to the above arrangement.

a) Dr. A by ₹50,000; Cr B by ₹50,000
b) Cr. A by ₹50,000; Dr B by ₹50,000
c) Dr. A by ₹50,000; Cr C by ₹50,000
d) Cr. A by ₹50,000; Dr C by ₹50,000

Ans – c)

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