Preliminary Expenses are ₹36000 and Advertisement Suspense Expenditure is ₹24000. In old ratio 5:1 how much total will be debited to the first partner?

Correct answer: ₹50000

Both preliminary expenses and advertisement suspense expenditure are accumulated losses or fictitious assets that must be written off among the old partners. Their total is ₹36,000 + ₹24,000 = ₹60,000. Since the old ratio is 5:1, the first partner’s share is /6 of the total. Thus the debit is ₹60,000 × 5/6 = ₹50,000, so choice A is correct.

The remaining ₹10,000 belongs to the second partner. The new ratio is not used because these expenses relate to the period before reconstitution. A common mistake is to debit the first partner with the full ₹60,000, but accounting distributes the loss in the old ratio. Therefore ₹50,000 is the correct amount for the first partner.