Answer the next 5 questions from the passage-
A, B and C are partners in a firm sharing profits in the ratio of 3:2:1. D is admitted into the firm for 1/4th share in profits, which he gets as 1/8th from A and 1/8th from B. The total capital of the firm is agreed upon as ₹1,20,000 and D is to bring in cash equivalent to 1/4th of this amount as his capital. The capitals of other partners are also to be adjusted in the ratio of their respective shares in profits. The capitals of A, B and C after all adjustments are ₹40,000, ₹35,000 and ₹30,000 respectively.
D will bring in cash as his capital -
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Rs. 30,000
The passage fixes D’s capital directly: he brings cash equal to one-fourth of the total capital of the firm, the same fraction as his share of profit.
Total capital of the firm = Rs. 1,20,000
D’s capital = Rs. 1,20,000 × 1/4 = Rs. 30,000
The new ratio gives the same answer: 6/24 of Rs. 1,20,000 = Rs. 30,000.
Entry: Cash A/c Dr. Rs. 30,000 to D’s Capital A/c Rs. 30,000.
NCERT (2026-27 edition):
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