Deck 6: Partnership and Dissolution: Understanding the Ins and Outs of a Business Partnership

Question 1

Retirement or death of a partner.

A)is dissolution of partnership agreement
B)is dissolution of a firm
C)may or may not be a dissolution of partnership agreement
D)none of above

Answer 1

is dissolution of partnership agreement

Question 2

If all the partners, but one are insolvent it is:

A)dissolution of an agreement
B)dissolution of firm
C)may or may not cause dissolution
D)none of above

Answer 2

dissolution of firm

Question 3

If all the partners, but one, are solvent it is:

A)dissolution of partnership agreement
B)dissolution of firm
C)may or may not cause dissolution
D)none of above

Answer 3

dissolution of firm

Question 4

At the time of dissolution:

A)all the assets are transferred to realization a/c
B)only current assets are transferred to realization a/c
C)non cash assets are transferred to realization a/c
D)only liquid and current asset are transferred to realization a/c

Question 5

At the time of dissolution non - cash assets are credited with:

A)market value
B)book value
C)as the agreed amount among the partners
D)cost or market whichever is low

Question 6

If a partner takes over an asset of the firm, his capital account:

A)will be debited with the amount as agreed
B)will be credited with the market value of the asset
C)will be debited with book value of the asset
D)none of above

Question 7

Loss on realization is distributed among partners:

A)according to profit and loss ratio
B)according to capital ratio
C)as decided among them
D)none of above

Question 8

Loss on realization is:

A)debited to partners capital a/c
B)credited to partners capital a/c
C)debited to realization a/c
D)credited to realization a/c

Question 9

When all partners are insolvent creditors will be:

A)paid fully
B)paid rate ably
C)taken over by the partners
D)paid by government

Question 10

The persons who have entered into a partnership business are individually called:

A)realization a/c
B)partners capital a/c
C)sundry debtors
D)provision for bad debts a/c

Question 11

The persons who have entered into a partnership business are individually called:

A)vender
B)agents
C)partners
D)a firm

Question 12

If no provision is made in agreement regarding the duration of the partnership:

A)limited partnership
B)partnership at will
C)none
D)particular partnership

Question 13

A person who declares by word of mouth as partner of the firm is called:

A)active partner
B)estople partner
C)dormant partner
D)nominal partner

Question 14

A person who receives a share of profits from one of the regular partner is called:

A)secret partner
B)quasi
C)partner in profit only
D)sub - partner

Question 15

The agreement among partners which set out the terms on which they had agreed to form a partnership is called:

A)partnership deed
B)partnership at will
C)none of these
D)arbitration clause

Question 16

Every partner has a right to be consulted in all matters affecting the business of:

A)sole-tradership
B)partnership
C)jsc
D)both (a) and (b)

Question 17

For the firm interest on drawing is:

A)expense
B)income
C)liability
D)none

Question 18

A credit balance on a partner's current A/c is.

A)fixed capital
B)part of capital
C)a current asset
D)long - term liability

Question 19

Old profit sharing ratio minus new profit sharing ration is equal to:

A)sacrificing ratio
B)ratio of gain
C)capital ratio
D)none

Question 20

A is drawing Rs. 500 regularly on the 16th of every month, he will have to pay interest in a year on Rs. 6000 for the total period of @ given rate of interest):

A)5 months
B)6 months
C)7 months
D)12 months

Question 21

For any decrease in the value of liability, revolution A/c is to be:

A)debited
B)credited
C)both (cr.) & (dr.)
D)neither (dr.) & (cr.)

Question 22

Revolution A/c is a:

A)real a/c
B)personal a/c
C)cash a/c
D)nominal a/c

Question 23

When good will is brought in cash by new partner, method is known as:

A)premium method
B)revolution method
C)memorandum revolution method
D)none

Question 24

Section 37 of partnership act provided interest on the amount left by retiring or decreased partner at:

A)5%
B)10%
C)6%
D)bank rate

Question 25

When a partner dies, firm will receive the:

A)1/2 amount of policy
B)1/4 amount of policy
C)3/4 amount of policy
D)full amount of policy