12th Class Accountancy Fundamentals of Partnership Question Bank

done MCQs - Accounting for Partnership Firm : Fundamental Total Questions - 121

• question_answer1)
  Which of the following items is not dealt through profit and loss appropriation account?         (CBSE SQP 2020-21)
  A)
  Interest on Partner's Loan done clear
  B)
  Partner's salary done clear
  C)
  Interest on Partner's Capital done clear
  D)
  Partner's Commission   done clear
  View Solution play_arrow

• question_answer2)
  In the absence of partnership, interest on loan of a partner is allowed:                        (CBSE 2015)
  A)
  @ 8% per annum done clear
  B)
  @ 6% per annum done clear
  C)
  @ 12% per annum          done clear
  D)
  No interest is allowed done clear
  View Solution play_arrow

• question_answer3)
  A manager gets 5% commission on net profit after charging such commission, gross profit Rs.2,90,000 and expenses of indirect nature other than manager’s commission are Rs.80,000. Commission will be:
  A)
  Rs.10,500                      done clear
  B)
  Rs. 10,000                                                                                                         done clear
  C)
  Rs. 7,500                         done clear
  D)
    Rs. 11,000 done clear
  View Solution play_arrow

• question_answer4)
  Interest on capital will be paid to the partner if provided for in the partnership deed but only out of:
  A)
  profits                  done clear
  B)
  reserves done clear
  C)
  accumulated profits done clear
  D)
  goodwill done clear
  View Solution play_arrow

• question_answer5)
  Following are essential elements of a partnership firm except:
  A)
  atleast two persons done clear
  B)
    there is an agreement between all  partners   done clear
  C)
  equal share of profits and losses done clear
  D)
  partnership agreement is for some business done clear
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• question_answer6)
  In case of partnership, the act of any partner is:
  A)
  binding on all partners done clear
  B)
  binding on that partner only done clear
  C)
    binding on all partners except that particular partner done clear
  D)
    None of the above done clear
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• question_answer7)
  X and Y are partners. X draws fixed amount at the end of every month. Interest on drawings is charged @ 15% p.a At the end of the year, interest on drawings of Y amounts to Rs.4,125. Drawings of X will be:
  A)
  Rs.6 000 p.m.  done clear
  B)
  Rs.5,000 p.m. done clear
  C)
  Rs.4500 p.m. done clear
  D)
  Rs.4,000 p.m. done clear
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• question_answer8)
       A and B are partners in a firm. They are entitled to interest on their capitals but the net profit was not sufficient for this interest, then the net profit will be distributed among partners in:
  A)
  agreed ratio done clear
  B)
  profit sharing ratio done clear
  C)
  capital ratio  done clear
  D)
  equally done clear
  View Solution play_arrow

• question_answer9)
  In the absence of partnership agreement, interest on drawings of a partner is charged at:   (CBSE 20I5)
  A)
  8% p.a. done clear
  B)
  9% p.a. done clear
  C)
  12% p.a. done clear
  D)
  No interest is charged done clear
  View Solution play_arrow

• question_answer10)
  The liability of the partners in a partnership firm under the Indian Partnership Act is:
  A)
  limited    done clear
  B)
  unlimited done clear
  C)
  no liability done clear
  D)
  depend on the situation done clear
  View Solution play_arrow

• question_answer11)
  Balance of partner's current accounts are:
  A)
  debit balance done clear
  B)
  credit balance done clear
  C)
  debit or credit balances done clear
  D)
    neither debit nor credit balance done clear
  View Solution play_arrow

• question_answer12)
  On 1st June, 2018 a partner introduced in the firm additional capital Rs.5,000. In the absence of partnership deed, on 31st March, 2019 he will receive interest:
  A)
  Rs.300     done clear
  B)
  zero done clear
  C)
  Rs.250                  done clear
  D)
  Rs.180 done clear
  View Solution play_arrow

• question_answer13)
  A, B and C are partners in the ratio of 5 : 3 : 2. Before B's salary of Rs.1,700 firm's profit is Rs.9,700. How much in total B will receive from the firm?
  A)
  Rs.1,700               done clear
  B)
  Rs.4,000 done clear
  C)
  Rs.2,400                done clear
  D)
  Rs.4,100 done clear
  View Solution play_arrow

• question_answer14)
  Interest on capital is allowed on:
  A)
  the opening capital done clear
  B)
  the capital at the year end done clear
  C)
  average capital of the year done clear
  D)
  the capital in the middle of the year done clear
  View Solution play_arrow

• question_answer15)
  Excess amount that a firm gets over and above the market value of assets at the time of sale of its business is:
  A)
  profit                   done clear
  B)
  super profit done clear
  C)
  reserve                done clear
  D)
  goodwill done clear
  View Solution play_arrow

• question_answer16)
  When a partner is given guarantee by other partners, loss on such guarantee will be borne by:
  A)
  partnership firm done clear
  B)
  all the other partners done clear
  C)
  partners who give the guarantee done clear
  D)
  partner with highest profit sharing ratio done clear
  View Solution play_arrow

• question_answer17)
  Where will you record interest on drawings?
  A)
  Debit side of profit and Loss appropriation account done clear
  B)
  Credit side of profit and Loss appropriation account done clear
  C)
  Credit side of profit and loss account done clear
  D)
  Debit side of capital/current account only done clear
  View Solution play_arrow

• question_answer18)
  Which of the following statement is true?
  A)
  Fixed capital account will always have a credit balance done clear
  B)
  Current account can have a positive or a negative balance done clear
  C)
  Fluctuating capital account can have a positive or a negative' balance done clear
  D)
  All of the above done clear
  View Solution play_arrow

• question_answer19)
  According to profit and loss account, the net profit for the year is Rs.15,000. The total interest on partner’s capital is Rs.1,800 and interest on partner’s drawings is Rs.200. The net profit as per profit and loss appropriation account will be:
  A)
  Rs.16,600             done clear
  B)
  Rs.17,000 done clear
  C)
  Rs.13,000              done clear
  D)
  Rs.13,400 done clear
  View Solution play_arrow

• question_answer20)
  Which accounts are opened when the capitals are fixed?
  A)
  Only capital accounts done clear
  B)
  Only current accounts done clear
  C)
  Capital accounts as well as current accounts done clear
  D)
  Either capital accounts or current accounts done clear
  View Solution play_arrow

• question_answer21)
  Total capital employed in the firm is Rs.8,00,000, reasonable rate of return is 15% and profit for the year is Rs.12,00,000. The value of goodwill of the firm as per capitalisation method would be:
  A)
  Rs.82,00,000        done clear
  B)
  Rs.12,00,000 done clear
  C)
  Rs.72,00,000         done clear
  D)
  Rs.42,00,000 done clear
  View Solution play_arrow

• question_answer22)
  What should be the minimum number of persons to form a partnership?
  A)
  2                                  done clear
  B)
  7          done clear
  C)
  10                                 done clear
  D)
  20 done clear
  View Solution play_arrow

• question_answer23)
  If a fixed amount is withdrawn by a partner on the first day of every month, interest on the total amount is charged for ............ months.
  A)
  6                                  done clear
  B)
  \[{{6}^{\frac{1}{2}}}\]  done clear
  C)
  \[{{5}^{\frac{1}{2}}}\]            done clear
  D)
  12 done clear
  View Solution play_arrow

• question_answer24)
  On 1st January, 2019, a partner advanced a loan of Rs.10,000 to the firm. In the absence of agreement, interest on loan on 31st March, 2019 will be:
  A)
  Nil                       done clear
  B)
  Rs.150 done clear
  C)
  Rs.300                   done clear
  D)
  Rs.600 done clear
  View Solution play_arrow

• question_answer25)
  Features of a partnership firm are:
  A)
  two or more persons are carrying common business under an agreement. done clear
  B)
  they are sharing profits and losses in the fixed ratio. done clear
  C)
  business is carried by all or any of them acting for all as an agent. done clear
  D)
  All of the above                      done clear
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• question_answer26)
  Number of partners in a partnership firm may be:
  A)
  maximum two     done clear
  B)
  maximum ten done clear
  C)
  maximum one hundred   done clear
  D)
  maximum fifty done clear
  View Solution play_arrow

• question_answer27)
  Which one of the following items cannot be recorded in the profit and loss appropriation account?
  A)
  Interest on capital done clear
  B)
  Interest on drawings done clear
  C)
  Rent paid to partners    done clear
  D)
  Partner’s salary done clear
  View Solution play_arrow

• question_answer28)
  Average profit basis, goodwill is calculated by:
  A)
  no. of years purchased multiplied with average profits done clear
  B)
  no. of years purchased multiplied with super profits done clear
  C)
  summation of the discounted value of expected future benefits done clear
  D)
  super profit divided with expected rate of return done clear
  View Solution play_arrow

• question_answer29)
  Which of the following statement is true?
  A)
  A minor cannot be admitted as a partner done clear
  B)
  A minor can be admitted as a partner, only into the benefits of the partnership done clear
  C)
  A minor can be admitted as a partner but his rights and liabilities are same of adult partner done clear
  D)
  None of the above done clear
  View Solution play_arrow

• question_answer30)
  Seeta and Geeta are partners sharing profits and losses in the ratio 4 : 1. Meeta was manager who received the salary of Rs.4,000 p.m. in addition to a commission of 5% on net profits after charging such commission. Profit for the year is Rs.6,78,000 before charging salary. Find the total remuneration of Meeta.
  A)
  Rs.78,000             done clear
  B)
  Rs.88,000 done clear
  C)
  Rs.87,000              done clear
  D)
  Rs.76,000 done clear
  View Solution play_arrow

• question_answer31)
  A and B are partners in a partnership firm without any agreement. A devotes more time for the firm as compare to B. A will get the following commission in addition to profit in the firm’s profit:
  A)
  6% of profit         done clear
  B)
  4% of profit done clear
  C)
  5% of profit         done clear
  D)
  None of these done clear
  View Solution play_arrow

• question_answer32)
  In which of the following situation(s) need for valuation of goodwill arises for a partnership firm?
  A)
  At the time of change in profit sharing ratio done clear
  B)
  At the time of death/retirement of a partner done clear
  C)
  At the time of admission of a partner done clear
  D)
  All of the above done clear
  View Solution play_arrow

• question_answer33)
  When partners’ capital accounts are fixed, which one of the following items will be written in the partner’s capital account?
  A)
  Partner’s drawings done clear
  B)
  Additional capital introduced by the partner in the firm done clear
  C)
  Loan taken by partner from the firm done clear
  D)
  Loan advanced by partner to the firm done clear
  View Solution play_arrow

• question_answer34)
  X is a partner in a firm. He withdrew regularly Rs.100 at the beginning of every month for the six months ending 31st March, 2019. If interest on drawings is charged @ 8% p.a. the interest charged will be:
  A)
  Rs.24                            done clear
  B)
  Rs.14 done clear
  C)
  Rs.10                            done clear
  D)
  Rs.12 done clear
  View Solution play_arrow

• question_answer35)
  X and Y are partners in the ratio of 3 : 2. Their capitals are Rs.20,000 and Rs.10,000 respectively. Interest on capitals is allowed @ 8% p.a. Firm incurred a loss of Rs.6,000 for the year ended 31st March, 2019. Interest on capital will be:
  A)
  X Rs.1,600 ; Y Rs.800 done clear
  B)
  X Rs.800 ; Y Rs.400 done clear
  C)
  X Rs.1,440 ; Y Rs.960 done clear
  D)
  No interest will be allowed done clear
  View Solution play_arrow

• question_answer36)
  If equal amount is withdrawn by a partner in the end of each month during a period of 6 months, interest on the total amount will be charged for............ months.
  A)
  2.5                                done clear
  B)
  3            done clear
  C)
  3.5                                done clear
  D)
  6 done clear
  View Solution play_arrow

• question_answer37)
  A firm earns Rs. 110,000.The normal rate of return is 10%.The assets of the firm amounted to Rs.11,00,000 and liabilities Rs.1,00,000. Value of goodwill by capitalisation of average actual profits will be:
  A)
  Rs.2,00,000          done clear
  B)
  Rs.10,000 done clear
  C)
  Rs.5,000                done clear
  D)
  Rs.1,00,000 done clear
  View Solution play_arrow

• question_answer38)
  X and Y are partners in the ratio of 3 : 2. Their capitals are Rs.20,000 and Rs.10,000 respectively. Interest on capitals is allowed @ 8% p.a. Firm earned a profit of Rs.1,500 for the year ( ended 31st March, 2019. Interest on capital will be:
  A)
  X Rs.1,600 ; Y Rs.800         done clear
  B)
  X Rs.900 ; Y Rs.600 done clear
  C)
  X Rs.1,000 ; Y Rs.500 done clear
  D)
  No interest will be allowed done clear
  View Solution play_arrow

• question_answer39)
  Which accounts are opened when the capitals are fluctuating?
  A)
  Only capital accounts done clear
  B)
  Only current accounts done clear
  C)
  Capital accounts as well as current accounts done clear
  D)
  Either capital accounts or current accounts done clear
  View Solution play_arrow

• question_answer40)
  The relation of partner with the firm is that of:
  A)
  an owner             done clear
  B)
  an agent done clear
  C)
  an owner and an agent done clear
  D)
  a manager done clear
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• question_answer41)
  If date of drawings of the partner’s is not given in the question, interest is charged for how much time?
  A)
  1 month              done clear
  B)
  3 months done clear
  C)
  6 months            done clear
  D)
  12 months done clear
  View Solution play_arrow

• question_answer42)
  Which of the following is/are method(s) of valuation of goodwill?
  A)
  Average Profit Method done clear
  B)
  Super Profit Method done clear
  C)
  Capitalisation Method  done clear
  D)
  All of these done clear
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• question_answer43)
  A, B and C are partners in a firm without any agreement. They have contributed Rs.5,000, Rs.3,000 and Rs.2,000 by way of capital in the firm. A was unable to work for six months in a year due to illness. At the end of year, firm earned a profit of Rs.1,500. A’s share in the profit will be:
  A)
  Rs.750                           done clear
  B)
  Rs.375      done clear
  C)
  Rs.500                           done clear
  D)
  Rs.250 done clear
  View Solution play_arrow

• question_answer44)
  A partner withdraws Rs.800 each on 1st April and 1st Oct. Interest on his drawings @6% p.a. on 31st March will be:
  A)
  Rs.48                            done clear
  B)
  Rs.72       done clear
  C)
  Rs.24                            done clear
  D)
  Rs.96 done clear
  View Solution play_arrow

• question_answer45)
  In the absence of partnership deed, the interest is allowed on partner’s capital:
  A)
  @5%p.a.             done clear
  B)
  @6%p.a. done clear
  C)
  @12% p.a.          done clear
  D)
  No interest is allowed done clear
  View Solution play_arrow

• question_answer46)
  In the absence of partnership deed, the partners share profits or losses:
  A)
  in the ratio of their capitals done clear
  B)
  in the ratio decided by the court done clear
  C)
  equally done clear
  D)
  in the ratio of time devoted done clear
  View Solution play_arrow

• question_answer47)
  Weight average method of calculating goodwill is used when:
  A)
  profit are not equal done clear
  B)
  profits show a trend done clear
  C)
  profits are fluctuating done clear
  D)
  None of these done clear
  View Solution play_arrow

• question_answer48)
  On 1st April, 2018, X’s capital was Rs.20,000. On 1st October, 2018, he introduces additional capital of Rs.10,000. Interest on capital @6% p.a. on 31st March, 2019 will be:
  A)
  Rs.900                             done clear
  B)
  Rs.1,800     done clear
  C)
  Rs.1,050                          done clear
  D)
  Rs.1,500 done clear
  View Solution play_arrow

• question_answer49)
  There are two partners in a firm A and B, C is admitted into the firm for 1/3rd share of profit with the guaranteed profit of Rs.1,800 p.a. The firm’s total profit is Rs.4,200. If A stood as guarantor of guaranteed profit to C, how much profit would be given to A?
  A)
  Rs.2,000                        done clear
  B)
  Rs.1,500     done clear
  C)
  Rs.1,000                        done clear
  D)
  Rs.1,800 done clear
  View Solution play_arrow

• question_answer50)
  If equal amount is withdrawn by a partner in the beginning of each month during a period of 6 months, interest on the total amount will be charged for............... months.             
  A)
  2.5                                done clear
  B)
  3            done clear
  C)
  3.5                                done clear
  D)
  6 done clear
  View Solution play_arrow

• question_answer51)
  Pick odd one out.
  A)
  Goodwill is a fictitious asset done clear
  B)
  Goodwill is an intangible asset done clear
  C)
  Goodwill is a current asset done clear
  D)
  Goodwill is a wasting asset done clear
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• question_answer52)
  A partner introduced additional capital of Rs.3,000 and advanced a loan of Rs.4,000 to the firm at the beginning of the year. Partner will receive year’'s interest:
  A)
  Rs.420 done clear
  B)
  Rs.240      done clear
  C)
  Nil                                done clear
  D)
  Rs.180 done clear
  View Solution play_arrow

• question_answer53)
  Net profit of a firm is Rs.4,950. Manager is entitled to a commission of 10% on profits before charging his commission. Manager’s commission will be:
  A)
  Rs.495     done clear
  B)
  Rs.450      done clear
  C)
  Rs.550                           done clear
  D)
  Rs.485 done clear
  View Solution play_arrow

• question_answer54)
  Find out that goodwill which is accounted for, as per Accounting Standard 26.
  A)
  Purchased goodwill only done clear
  B)
  Self-generated goodwill done clear
  C)
  Both a and b done clear
  D)
  Goodwill brought in by a partner done clear
  View Solution play_arrow

• question_answer55)
  The goodwill of the firm is not affected by:
  A)
  location of the firm done clear
  B)
  reputation of firm done clear
  C)
  better customer service done clear
  D)
  None of these done clear
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• question_answer56)
  A and B are partners in partnership firm without any agreement. A has given a loan of Rs.50,000 to the firm. At the end of year, loss was incurred in the business. Following interest may be paid to A by the firm:
  A)
  @5% per annum done clear
  B)
  @6% per annum done clear
  C)
  @6% per month done clear
  D)
  as there is a loss in the business, interest can’t be paid done clear
  View Solution play_arrow

• question_answer57)
  Every partner is bound to attend diligently to his............... in the conduct of the business.
  A)
  rights                             done clear
  B)
  meetings   done clear
  C)
  capital                           done clear
  D)
  duties done clear
  View Solution play_arrow

• question_answer58)
  Interest on partner’s drawings will be credited to:
  A)
  profit and loss account done clear
  B)
  profit and loss appropriation account done clear
  C)
  partner’s capital accounts done clear
  D)
  None of the above done clear
  View Solution play_arrow

• question_answer59)
  In case of fixed capitals, partners will have:
  A)
  credit balance in their capital accounts done clear
  B)
  debit balance in their capital accounts done clear
  C)
  may have credit or debit balances in their capital accounts done clear
  D)
  credit balance or nil balance in their capital accounts done clear
  View Solution play_arrow

• question_answer60)
  Which item is recorded on the credit side of partner’s current accounts?
  A)
  Interest on Partner’s Capitals done clear
  B)
  Salaries of Partners done clear
  C)
  Share of Profits of Partners done clear
  D)
  All of these done clear
  View Solution play_arrow

• question_answer61)
  Current accounts of partners are maintained if:
  A)
  capitals are fixed done clear
  B)
  capitals are fluctuating done clear
  C)
  whether capitals are fixed or fluctuating done clear
  D)
  as is decided by the partners done clear
  View Solution play_arrow

• question_answer62)
  Oustensible partners are those who:
  A)
  do not contribute any capital but get some share of profit for lending their name to the business done clear
  B)
  contribute very less capital but get equal profit done clear
  C)
  do not contribute any capital and without having any interest in the business, lend their name to the business done clear
  D)
  contribute maximum capital of the business done clear
  View Solution play_arrow

• question_answer63)
  In case of fixed capitals, interest on capital:
  A)
  is credited to partner’s capital account done clear
  B)
  is credited to partner’s current account done clear
  C)
  may be credited to partner’s capital or current account done clear
  D)
  is debited to partner’s capital account done clear
  View Solution play_arrow

• question_answer64)
  Under the capitalisation method of valuation of goodwill, the formula for calculating goodwill is:
  A)
  super profits multiplied by the rate of return done clear
  B)
  average profits multiplied by the rate of return done clear
  C)
  super profits divided by the rate of return done clear
  D)
  average profits divided by the rate of return done clear
  View Solution play_arrow

• question_answer65)
  Z is a partner in a firm. He withdraw regularly Rs.2,000 every month for the six months ending 31st March, 2019. If interest on drawings is charged @8% p.a. the interest charged will be:
  A)
  Rs.480                           done clear
  B)
  Rs.280     done clear
  C)
  Rs.200                           done clear
  D)
  Rs.240 done clear
  View Solution play_arrow

• question_answer66)
  Sleeping partners are those who:
  A)
  take active part in the conduct of the business but provide no capital. However, salary is paid to them. done clear
  B)
  do not take any part in the conduct of the business but provide capital and share profits and losses in the agreed ratio. done clear
  C)
  take active part in the conduct of the business but provide no capital. However, share profits and losses in the agreed ratio. done clear
  D)
  do not take any part in the conduct of the business and contribute no capital. However, share profits and losses in the agreed ratio. done clear
  View Solution play_arrow

• question_answer67)
  In case of fluctuating capitals, interest on capital:
  A)
  is credited to partner’s capital account done clear
  B)
  is credited to partner’s current account done clear
  C)
  may be credited to partner’s capital or current account done clear
  D)
  interest payable account done clear
  View Solution play_arrow

• question_answer68)
  Interest on partner’s capitals will be debited to:
  A)
  profit and loss account done clear
  B)
  profit and loss appropriation account done clear
  C)
  partner’s capital accounts done clear
  D)
  None of the above done clear
  View Solution play_arrow

• question_answer69)
  If a fixed amount is withdrawn by a partner on the last day of every month, interest on the total amount is charged for ............ months.
  A)
  12                                 done clear
  B)
  \[{{6}^{\frac{1}{2}}}\]        done clear
  C)
  \[{{5}^{\frac{1}{2}}}\]            done clear
  D)
  6 done clear
  View Solution play_arrow

• question_answer70)
  Interest on partner’s drawings will be debited to:
  A)
  profit and loss account done clear
  B)
  profit and loss appropriation account done clear
  C)
  partner's current account done clear
  D)
  interest account done clear
  View Solution play_arrow

• question_answer71)
  Forming a partnership deed is:
  A)
  mandatory          done clear
  B)
  mandatory in writing done clear
  C)
  not mandatory     done clear
  D)
  None of these done clear
  View Solution play_arrow

• question_answer72)
  When goodwill is not a purchased goodwill, goodwill:
  A)
  is not shown in the balance sheet done clear
  B)
  is shown in the balance sheet done clear
  C)
  may or may not in the balance sheet. done clear
  D)
  is partly shown in the balance sheet done clear
  View Solution play_arrow

• question_answer73)
  In the absence of an agreement to the contrary, the partners are:
  A)
  entitled to 6% interest on their capitals, only when there are profits done clear
  B)
  entitled to 9% interest on their capitals only when there are profits done clear
  C)
  entitled to interest on their capitals at the bank  rate, only when there are profits done clear
  D)
  not entitled to interest on their capitals done clear
  View Solution play_arrow

• question_answer74)
  Partnership deed is also called............
  A)
  Prospectus          done clear
  B)
  Articles of Association done clear
  C)
  Principles of Partnership    done clear
  D)
  Articles of Partner done clear
  View Solution play_arrow

• question_answer75)
  For the firm, interest on capital is:
  A)
  capital payment  done clear
  B)
  capital receipt done clear
  C)
  loss                     done clear
  D)
  income done clear
  View Solution play_arrow

• question_answer76)
  Which of the following items will not be shown in the debit of profit and loss appropriation account?
  A)
  Interest on Capital done clear
  B)
  Commission to a partner done clear
  C)
  Interest on Drawings done clear
  D)
  Salary to partners done clear
  View Solution play_arrow

• question_answer77)
  Interest on partner’s capitals will be credited to:
  A)
  profit and loss account done clear
  B)
  profit and loss appropriation account done clear
  C)
  interest account done clear
  D)
  partner’s capital accounts done clear
  View Solution play_arrow

• question_answer78)
  Capital employed by a partnership firm is Rs.5,00,000. Its average profit is Rs.60,000. The normal rate of return is similar type of business is 10%. The amount of super profit is:
  A)
  Rs.50,000             done clear
  B)
  Rs.10,000 done clear
  C)
  Rs.6,000                done clear
  D)
  Rs.56,000 done clear
  View Solution play_arrow

• question_answer79)
  How would you close the partner’s drawings account?
  A)
  By transfer to capital or current account debit side done clear
  B)
  By transfer to capital account credit side done clear
  C)
  By transfer to current account credit side done clear
  D)
  Either b. or c. done clear
  View Solution play_arrow

• question_answer80)
  When partners’ capital accounts are floating, which one of the following items will be written on the credit side of the partners’ capital accounts?
  A)
  Interest on drawings done clear
  B)
  Loan advanced by partner to the firm done clear
  C)
  Partner’s share in the firm’s loss done clear
  D)
  Salary to the active partners done clear
  View Solution play_arrow

• question_answer81)
  For the firm. interest on drawings is:
  A)
  capital payment   done clear
  B)
  expenses done clear
  C)
  capital receipt      done clear
  D)
  income done clear
  View Solution play_arrow

• question_answer82)
  X and Y are partners in the ratio of 3 : 2. Their capitals are Rs.2,00,000 and Rs.1,00,000 respectively. Interest on capitals is allowed @ 8% p.a. Firm earned a profit of Rs.15,000 for the year ended 31st March, 2019. As per partnership agreement, interest on capital is treated a charge on profits. Interest on capital will be:
  A)
  X Rs.16,000; Y Rs.8,000 done clear
  B)
  X Rs.9000; Y Rs.6,000 done clear
  C)
  X Rs.10,000; Y Rs.5,000  done clear
  D)
  No interest will be allowed done clear
  View Solution play_arrow

• question_answer83)
  Which of the following items are recorded in the profit & loss appropriation account of a partnership firm?
  A)
  Interest on Capital        done clear
  B)
  Salary to Partner done clear
  C)
  Transfer to Reserve done clear
  D)
  All of these done clear
  View Solution play_arrow

• question_answer84)
  The written agreement among the partners is called:
  A)
  Partnership Deed done clear
  B)
  Partnership by Laws done clear
  C)
  Partnership Constitution   done clear
  D)
  A Contract done clear
  View Solution play_arrow

• question_answer85)
  Interest on capitals of partners under the fluctuating capital accounts method is credited to:
  A)
  payable account  done clear
  B)
  profit and loss account done clear
  C)
  partners’ capital accounts  done clear
  D)
  partners’ current accounts done clear
  View Solution play_arrow

• question_answer86)
  Following are the factors affecting goodwill except:
  A)
  Nature of Business done clear
  B)
  Location of the customers done clear
  C)
  Technical Know-how    done clear
  D)
  Efficiency of Management done clear
  View Solution play_arrow

• question_answer87)
  Average profit of a business over the last five years was Rs.60,000. The normal yield on capital invested in such a business is estimated at 10% p.a. The net capital invested in the business is Rs.5,00,000. Amount of goodwill, if it is based on 3 years’ purchase of last 5 years super profits will be:
  A)
  Rs.1,00,000                   done clear
  B)
  Rs.1,80,000 done clear
  C)
  Rs.30,000                      done clear
  D)
  Rs.1,50,000 done clear
  View Solution play_arrow

• question_answer88)
  If a fixed amount is withdrawn by a partner in the middle of every month, interest on the total amount is charged for............ months.
  A)
  6                                  done clear
  B)
  \[{{6}^{\frac{1}{2}}}\]         done clear
  C)
  \[{{5}^{\frac{1}{2}}}\]            done clear
  D)
  12 done clear
  View Solution play_arrow

• question_answer89)
  If equal amount is withdrawn by a partner in each month during a period of 6 months, interest on the total amount will be charged for............... months.
  A)
  6                                  done clear
  B)
  3           done clear
  C)
  2.5                                done clear
  D)
  3.5 done clear
  View Solution play_arrow

• question_answer90)
  In the absence of agreement, partners are not entitled to:
  A)
  salary                  done clear
  B)
  commission done clear
  C)
  equal share in profit done clear
  D)
  Both a and b done clear
  View Solution play_arrow

• question_answer91)
  Y is a partner in a firm. He withdraw regularly Rs.3,000 at the end of every month for the six months ending 31st March, 2019. If interest on drawings is charged @ 10% p.a. the interest charged will be:
  A)
  Rs.375                           done clear
  B)
  Rs.450     done clear
  C)
  Rs.525                           done clear
  D)
  Rs.900 done clear
  View Solution play_arrow

• question_answer92)
  According to profit and loss account, the net profit for the year is Rs.4,20,000. Salary of a partner is Rs.5,000 per month and the commission of another partner is Rs.10,000. The interest on drawings of partners is Rs.4,000. The net profit as per profit and Loss appropriation account will be:
  A)
  Rs.3,54,000                   done clear
  B)
  Rs.3,46,000 done clear
  C)
  Rs.4,09,000                   done clear
  D)
  Rs.4,01,000 done clear
  View Solution play_arrow

• question_answer93)
  Vikas is a partner in a firm. His drawings during the year ended 31st March, 2019 were Rs.72,000. If interest on drawings is charged @ 9% p.the interest charged will be:
  A)
  Rs.324                           done clear
  B)
  Rs.6,480     done clear
  C)
  Rs.3,240                        done clear
  D)
  Rs.648 done clear
  View Solution play_arrow

• question_answer94)
  A partner draws Rs.2,000 each in 1st April 2018, 1st July 2018, 1st October 2018 and 1st January 2019. For the year ended 31st March, 2019 interest on drawings @ 8% per annum will be:
  A)
  Rs.540                           done clear
  B)
  Rs.320      done clear
  C)
  Rs.960                           done clear
  D)
  Rs.400 done clear
  View Solution play_arrow

• question_answer95)
  A and B contribute Rs.1,00,000 and Rs.60,000 respectively in a partnership firm by way of capital on which they agree to allow interest @ 8% p.a. Their profit or Loss sharing ratio is 3 : 2. The profit at the end of the year was Rs.2,800 before allowing interest on capital. If there is a clear agreement that interest on capital will be paid even in case of Loss, then B’s share will be:
  A)
  Profit Rs.6,000      done clear
  B)
  Profit Rs.4,000 done clear
  C)
  Loss Rs.6,000        done clear
  D)
  Loss Rs.4,000 done clear
  View Solution play_arrow

• question_answer96)
  Under what circumstances, a partner can get exemption from sharing losses in a firm?
  A)
  If he is a senior citizen done clear
  B)
  If he is a minor done clear
  C)
  If he is retiring partner  done clear
  D)
  All of these done clear
  View Solution play_arrow

• question_answer97)
  Why a partnership firm needs partnership deed?
  A)
  It acts as a proof in any dispute done clear
  B)
  It regulates rights of partners done clear
  C)
  It represents duties and Liabilities of partners done clear
  D)
  All of the above done clear
  View Solution play_arrow

• question_answer98)
  Need of profit and loss adjustment account is for:
  A)
  appropriation of profits done clear
  B)
  charge against profits done clear
  C)
  rectification of errors of omissions done clear
  D)
  None of the above done clear
  View Solution play_arrow

• question_answer99)
  Which of the following factors help in generation of self-generated goodwill?
  A)
  Hardwork of organisation done clear
  B)
  Better quality products done clear
  C)
  Better customer services done clear
  D)
  All of the above done clear
  View Solution play_arrow

• question_answer100)
  Rights of a partner consists which of the following?
  A)
  Right to inspect book of accounts done clear
  B)
  Right to not allow the admission of new partner done clear
  C)
  Right of conducts affairs of business done clear
  D)
  All of the above done clear
  View Solution play_arrow

• question_answer101)
  If firm gives guarantee to a partner then who will sacrifice for this guarantee?
  A)
  All partners equally done clear
  B)
  Only that partner who has maximum profit done clear
  C)
  All partners in profit or Loss sharing ratio done clear
  D)
  All of the above done clear
  View Solution play_arrow

• question_answer102)
  Loan has been given by wife of a partner to the firm. Now partner wants interest @ 6% per annum as per Partnership Act, 1932 while partnership deed is silent. Solve this issue.
  A)
  Provide 6% per annum interest as Partnership Act says done clear
  B)
  Provision of interest on loan @ 6% per annum of the Partnership Art does not apply done clear
  C)
  Provide 10% interest to solve the issue done clear
  D)
  None of the above done clear
  View Solution play_arrow

• question_answer103)
  A partner withdrew Rs.4,000 per month from 1st July, 2016, on beginning of every month. Accounts are closed at 31st March, 2017. Calculate interest on drawings while rate of interest is 10% per annum.
  A)
  Rs.1,600               done clear
  B)
  Rs.1,800 done clear
  C)
  Rs.1,500                 done clear
  D)
  Rs.2,200 done clear
  View Solution play_arrow

• question_answer104)
  ‘A’ has given guarantee to ‘C for minimum Rs.10,000 profit At year end, the firm suffered loss and C’s share in the loss was Rs.2,000. Calculate amount of deficiency to be borne by’
  A)
  Rs.2,000               done clear
  B)
  Rs.10,000 done clear
  C)
  Rs.12,000              done clear
  D)
  None of these done clear
  View Solution play_arrow

• question_answer105)
  In a firm, 10% of net profit after deducting all adjustments, including reserve is transferred to general reserve. The net profit after all adjustments but before transfer to general reserve is Rs.44,000. Calculate the amount which is to be transferred to reserve:
  A)
  Rs.2,500                        done clear
  B)
  Rs.4,000               done clear
  C)
  Rs.4,400                done clear
  D)
  Rs.2,200 done clear
  View Solution play_arrow

• question_answer106)
  Where a partner is entitled to interest on capital conteributed by him, such interest will be payable:
  A)
  only out of profit done clear
  B)
  only out of capital done clear
  C)
  Both a and b done clear
  D)
  None of these  done clear
  View Solution play_arrow

• question_answer107)
  A charitable dispensary is run by 8 members. A new member wants to join them. The new member is of the opinion that partnership deed must be written while other members refused to do that. They said this is not a partnership. Give reason(s) in favour of other members.
  A)
  There is no business done clear
  B)
  There is no sharing of profits done clear
  C)
  There is no motive of profit making done clear
  D)
  All of the above done clear
  View Solution play_arrow

• question_answer108)
  In a partnership, manager’s commission is shown in:
  A)
  profit and loss account done clear
  B)
  profit and loss appropriation account done clear
  C)
  balance sheet done clear
  D)
  None of the above done clear
  View Solution play_arrow

• question_answer109)
  If partnership deed is silent or has not been formulated, then partners are entitled for:
  A)
  salary                  done clear
  B)
  commission done clear
  C)
  interest on loan    done clear
  D)
  profit share in capital ratio done clear
  View Solution play_arrow

• question_answer110)
  If a partner individually carries on any business of the same nature as competing with that of firm, he shall account for
  A)
  retire from partnership done clear
  B)
  all profits made by him done clear
  C)
  dissolve the firm   done clear
  D)
  None of these done clear
  View Solution play_arrow

• question_answer111)
  ‘A’ and ‘B’ were partners in a firm. They share their profits in the ratio of 2:1. A withdraws an amount of Rs.2,000 on 1st July, 2017. Journalise it:
  A)
  Profit and Loss Appropriation A/c Dr.        2000     To        As capital A/c     2000 done clear
  B)
  A’s Capital A/c               Dr.        2,000    To Profit and Loss A/c    2,000 done clear
  C)
  A’s Drawings A/c            Dr.        2,000    To Cash/Bank A/c          2,000 done clear
  D)
  A’s Capital A/c               Dr.        2,000    To As Drawings A/c        2,000 done clear
  View Solution play_arrow

• question_answer112)
  ‘G’ and ‘B’ are partners in a firm, ‘G’ withdraw Rs.800 per month at the beginning of every month for 6 months ending on 31st December, 2017.’B’ withdraw Rs.800 per month at the end of every month for 6 months ending on 31st December, 2017. Calculate interest on drawings @ 15% per annum on 31st December, 2017.
  A)
  G= Rs.320, B = Rs.280 done clear
  B)
  G= Rs.180, B = Rs.220 done clear
  C)
  G= Rs.720, B = Rs.720         done clear
  D)
  G= Rs.210, B = Rs.150 done clear
  View Solution play_arrow

• question_answer113)
  When fluctuating capital method is used, which of the following items are shown in debit side of partners’ capital account?
  A)
  Opening debit balance of capital account done clear
  B)
  Drawings done clear
  C)
  Interest on drawings done clear
  D)
  All of the above done clear
  View Solution play_arrow

• question_answer114)
  ‘A’ and ‘B’ were partners in a firm. They share profits in the ratio of 2:3.Their capital account balance as on 1st April, 2017 was Rs.10,00,000 and Rs.20,00,000. Additional capital introduced by them, A = Rs.3,00,000, B = Rs.2,00,000. Journalise it.
  A)
  Bank A/c                       Dr. 5,00,000        To A’s Capital A/c                           3,00,000        To B’s Capital A/c                           2,00,000 done clear
  B)
  A’s Capital A/c                    Dr. 3,00,000     B’s Capital A/c                    Dr. 2,00,000          To Bank A/c                                 5,00,000 done clear
  C)
  A’s Capital A/c                   Dr. 3,00,000            To Bank A/c                               3,30,000 done clear
  D)
  B’s Capital A/c                  Dr. 2,00,000           To Bank A/c                              2,00,000 done clear
  View Solution play_arrow

• question_answer115)
  ‘A’ and ‘B ‘are partners in a firm. They share profits in the ratio of 1:1. In this year, they suffered a loss. They maintain capital accounts under fluctuating account method Pass journal entry to transfer the loss to the capital accounts of ‘A’ and ‘B’.
  A)
  Profit and Loss Appropriation A/c         Dr.            To As Capital A/c            To B’s Capital A/c done clear
  B)
  As Capital A/c                                        Dr.            To B’s Capital A/c done clear
  C)
  As Capital A/c                                        Dr.     B’s Capital A/c                                   Dr.            To Profit and Loss A/c done clear
  D)
  None of the above done clear
  View Solution play_arrow

• question_answer116)
  ‘R’ and ‘S’ were partners in a firm. They share their profits and losses in 1:2 ratio. ‘R’ is hard working and dedicated to the affairs of the firm. As per contract or deed he is to receive Rs.500 per month as salary. Journalise it if capital account is maintained under fixed capital method.
  A)
  Profit and Loss A/c                Dr.    6,000             To R’s Capital A/c                              6,000 done clear
  B)
  Profit and Loss Appropriation A/c   Dr.    6.000          To R’s Current A/c                     6,000 done clear
  C)
  Salary A/c                         Dr.    6,000        To Profit and Loss A/c                         6,000 done clear
  D)
  Salary A/c                        Dr.    6,000           To R’s Current A/c                             6,000 done clear
  View Solution play_arrow

• question_answer117)
  Pass the journal entry to record salary of partner:
  A)
  Profit and Loss Appropriation A/c Dr.           To Partner’s Capital A/c done clear
  B)
  Profit and Loss A/c                       Dr.           To Salary A/c done clear
  C)
  Partner’s Capital A/c                     Dr.           To Salary A/c done clear
  D)
  Salary A/c                                    Dr.            To Profit and Loss Appropriation A/c done clear
  View Solution play_arrow

• question_answer118)
  ‘X’ and ‘Y’ are partners in a firm sharing profits in the ratio of 3:2.As per their agreement, ‘X’ will receive 5% per annum interest on his loan of Rs.1,00,000 and ‘Y’ will receive 2% commission on sales affected by him, which were Rs.1,00,000. Calculate X’s share of profit when net profit as per profit and loss account is Rs.1,00,000.
  A)
  Rs.58,800             done clear
  B)
  Rs.58,000 done clear
  C)
  Rs.60,000              done clear
  D)
  Rs.48,200 done clear
  View Solution play_arrow

• question_answer119)
  Which of the following items is not recorded in profit and Loss appropriation account?
  A)
  Interest on Partner’s Capital done clear
  B)
  Amount of Partner’s Drawings done clear
  C)
  Profit as per Profit and Loss done clear
  D)
  Commission to a Partner done clear
  View Solution play_arrow

• question_answer120)
  If a firm gives guarantee to partner and in same way partner give guarantee to firm. So, these are two guarantees in same year. This guarantee, given by firm to partner and partner to firm is called:
  A)
  guarantee by firm done clear
  B)
  guarantee by partner done clear
  C)
  simultaneous guarantee done clear
  D)
  None of the above done clear
  View Solution play_arrow

• question_answer121)
  The capital balance of a partner at the end of the year (after adjusting for this drawings Rs.3,500 and his share in the profit Rs.2,300) is Rs.12,000. Interest on capital is payable to him at 5% per annum. What will be the amount of interest on capital?
  A)
  Rs.660                  done clear
  B)
  Rs.600 done clear
  C)
  Rs.5,400               done clear
  D)
  None of these done clear
  View Solution play_arrow