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Admission Of Partner — Revision Notes

Telangana Open School (TOSS) · Class 12 · Accountancy

Admission Of Partner revision notes for Telangana Open School (TOSS) Class 12 Accountancy: 4 topics in quick points.

48 questions20 flashcards6 formulas & key relations5 concepts

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Key Topics to Revise

1

Meaning and Implications of Admission

  • Admission of a partner means a new person is inducted into an existing partnership firm.
  • It requires the consent of all existing partners unless otherwise agreed.
  • The firm is reconstituted, and a new partnership deed is prepared.
2

New Profit Sharing Ratio and Sacrificing Ratio

  • New profit sharing ratio is the proportion in which all partners (including the new one) will share future profits.
  • Sacrificing ratio is the ratio in which existing partners give up their share of profit for the new partner.
  • Sacrificing Ratio = Old Ratio – New Ratio.
3

Goodwill: Meaning, Factors, and Valuation

  • Goodwill is the intangible value of a firm’s reputation that enables it to earn excess profits.
  • It arises due to factors like location, quality, management efficiency, and market position.
  • Goodwill is valued at the time of admission because the new partner benefits from it.
4

Accounting Treatment of Goodwill

  • As per AS-10, goodwill is recorded only if paid in cash or kind.
  • If new partner brings cash for goodwill, it is credited to goodwill premium account and then transferred to old partners in sacrificing ratio.
  • If not brought in cash, the new partner’s capital is debited and old partners’ capital credited in sacrificing ratio.

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Full Notes

Key Concepts

When a new person joinsThe ratio in which all partnersThe ratio in which old partnersThe monetary value of a firm'sAssets and liabilities are revalued

Frequently Asked Questions

What are the important topics in Admission Of Partner for Telangana Open School (TOSS) Class 12 Accountancy?
Key topics in Admission Of Partner include Meaning and Implications of Admission, New Profit Sharing Ratio and Sacrificing Ratio, Goodwill: Meaning, Factors, and Valuation, Accounting Treatment of Goodwill. Study these first, then practise questions on each for the Telangana Open School (TOSS) Class 12 board exam.
How should I revise Admission Of Partner for the Telangana Open School (TOSS) Class 12 board exam?
Learn the core ideas first, then work through the 48 practice questions on Admission Of Partner. Revise definitions regularly and use flashcards for quick recall before the exam.

Sources & Official References

Content is aligned to the official syllabus. Refer to the board website for the latest curriculum.

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All Telangana Open School (TOSS) Class 12 Accountancy Revision Notes

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