Match List-I with List-II
List-I
(A) Goodwill
(B) Sacrificing ratio
(C) New profit sharing ratio
(D) Premium for Goodwill
List-II
(I) Amount brought by new partner to compensate old partners
(II) Advantage of reputation, enabling firm to earn super profits
(III) Ratio in which old partner give up their share
(IV) Ratio after reconstitution of partnership
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
Correct answer: Option (2) → (A) - (II), (B) - (III), (C) - (IV), (D) - (I)
Concept: Key terms relating to admission of a partner, from Reconstitution of a Partnership Firm – Admission of a Partner.
(A) Goodwill – the advantage of reputation enabling the firm to earn super profits → (II).
(B) Sacrificing ratio – the ratio in which old partners give up their share → (III).
(C) New profit sharing ratio – the ratio after reconstitution → (IV).
(D) Premium for goodwill – the amount brought in by the new partner to compensate old partners → (I).
Thus A-II, B-III, C-IV, D-I.