Match list I with list II and choose the correct ans from the options…

Match list I with list II and choose the correct ans from the options given below:

LIST 1	LIST 2
A) Interest on Capital	I) Admission of partner
B) Gaining Ratio	II) Profit/loss in the old profit-sharing ratio
C) Sacrificing ratio	III) Continuing partners
D) Revaluation of assets and liabilities	IV) When partnership deed specifically provide for it

Answer & explanation

Correct answer: option 4

The correct answer is Option (4) → A-IV, B-III, C-I, D-II

Each term belongs to the situation where it is used:

(A) Interest on Capital — this matches (IV) When partnership deed specifically provide for it. No interest on capital is allowed unless the partners have agreed to it.

(B) Gaining Ratio — this matches (III) Continuing partners. It is the ratio in which the continuing partners take the share of a retiring or deceased partner.

(C) Sacrificing ratio — this matches (I) Admission of partner. The old partners give up a share of profit in favour of the incoming partner.

(D) Revaluation of assets and liabilities — this matches (II) Profit/loss in the old profit-sharing ratio. The revaluation gain or loss belongs to the old partners in their old ratio.

NCERT (2026-27 edition):
Interest on Capital – “No partner is entitled to claim any interest on the amount of capital contributed by him in the firm as a matter of right. However, interest can be allowed when it is expressly agreed to by the partners.”

NCERT (2026-27 edition):
Gaining Ratio – “The ratio in which the continuing partners have acquired the share from the retiring/deceased partner is called the gaining ratio.”

NCERT (2026-27 edition):
Sacrificing Ratio – “The ratio in which the old partners agree to sacrifice their share of profit in favour of the incoming partner is called sacrificing ratio.”

NCERT (2026-27 edition):
Revaluation of Assets and Reassessment of Liabilities – “… If the revaluation account finally shows a credit balance then it indicates net gain and if there is a debit balance then it indicates net loss. Which will be transferred to the capital accounts of the old partners in old ratio.”