Match List-I with List-II. List-I List-II (A) Increase in Furniture V…

Match List-I with List-II.

List-I	List-II
(A) Increase in Furniture Value	(I) Credit side of Partner's Capital A/c
(B) Depreciation on Machinery	(II) Debt side of Partner 's Capital A/c
(C) General Reserve	(III) Credit side of Revaluation A/c
(D) Goodwill appearing in Books	(IV) Debit side of Revaluation A/c

Choose the correct answer from the options given below :

Answer & explanation

Correct answer: option 2

The correct answer is Option (2) → (A)-(III), (B)-(IV), (C)-(I), (D)-(II)

(A) Increase in Furniture Value — this matches (III) Credit side of Revaluation A/c. A rise in the value of an asset is a gain on revaluation.

(B) Depreciation on Machinery — this matches (IV) Debit side of Revaluation A/c. A fall in the value of an asset is a loss on revaluation.

(C) General Reserve — this matches (I) Credit side of Partner’s Capital A/c. It is an accumulated profit, credited to the old partners in their old ratio.

(D) Goodwill appearing in Books — this matches (II) Debt side of Partner’s Capital A/c. Existing goodwill is written off by debiting the old partners’ capital accounts in their old ratio.

NCERT (2026-27 edition):
Revaluation of Assets and Reassessment of Liabilities – “… The gain or loss on revaluation of each asset and liability is transferred to this account and finally its balance is transferred to the capital accounts of the old partners in their old profit sharing ratio. In other words, the revaluation account is credited with increase in the value of each asset and decrease in its liabilities because it is a gain and is debited with decrease in the value of assets and increase in its liabilities is debited to revaluation account because it is a loss.”

NCERT (2026-27 edition):
Adjustment for Accumulated Profits and Losses – “Sometimes a firm may have accumulated profits not yet transferred to capital accounts of the partners. These are usually in the form of general reserve, reserve and/or Profit and Loss Account. The new partner is not entitled to have any share in such accumulated profits. These are distributed among the partners by transferring it to their capital current accounts in old profit sharing ratio.”

NCERT (2026-27 edition):
When goodwill exists in the books – “… : Goodwill appearing in the books will be written-off by debiting old partners ‘capital accounts in their old profit sharing ratio.”