CBSE Class 12 Accountancy sample paper 2025-26: question 5
From the official CBSE sample question paper for 2025-26, section A, question 5, for 1 mark. Try it first; the hints and our step-by-step solution are below.
Q5 · 1 mark · MCQReconstitution of a Partnership Firm – Admission of a Partner
Bala and Lala were partners in a firm with Capitals of ₹ 24,00,000 and 16,00,000. They admitted Mala as a new partner for 1/3 share for which Mala brings ₹ 20,00,000 as capital. There was Investment and Investment Fluctuation Reserve appearing in the books of ₹ 2,50,000 and ₹ 50,000 respectively. Bala took over 40% of the Investments at ₹ 80,000 and remaining Investments were valued at ₹ 1,10,000. By what amount Revaluation account will be affected for the above information?
- (A)Debited ₹ 60,000
- (B)Credited with ₹ 60,000
- (C)Debited ₹ 10,000
- (D)Credited ₹ 10,000
Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2025-26.
Hints
Open one hint at a time and try again before the next.
Hint 1
Find the total fall in the value of investments.
Hint 2
Which reserve is used first to meet a fall in investments?
Step-by-step solution
Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.
Book value of investments ₹ 2,50,000. Bala takes 40% (book value ₹ 1,00,000) at ₹ 80,000; the remaining 60% (₹ 1,50,000) is valued at ₹ 1,10,000. New total = ₹ 1,90,000, a fall of ₹ 60,000.
- 1 mark
The Investment Fluctuation Reserve of ₹ 50,000 absorbs the fall first. Only the excess ₹ 10,000 is a loss debited to Revaluation Account. Option (C).
Answer: (C) Debited ₹ 10,000
Where the marks are
- Fall ₹ 60,000 less IFR ₹ 50,000 = ₹ 10,000 debited to Revaluation A/c (1 mark)
Revise the chapter
- Chapter: Reconstitution of a Partnership Firm – Admission of a Partner (notes, formulas, where marks are lost and every past question)
- Topic: Revaluation Account and Reserves on Admission
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