Financial Accounting MCQ on Partnership Accounts

MCQ on Partnership Accounts

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Also Read Financial Accounting MCQ

• MCQ on GAAP
• MCQ on Basic Fundamentals
• MCQ on Financial Statements
• MCQ on Accounting Standards
• MCQ on Partnership Accounts

1. Partnership act enacted in which year?

(a) 1942

(b) 1936

(c) 1932

(d) 1928

Answer (c) 1932

2. Change in constitution of the firm may be due to

(a) Admission of a new partner

(b) Retirement of a partner

(c) Death of the partner

(d) All of the above

Answer (d) All of the above

3. Sacrificing ratios equal to

(a) Old ratio – New ratio

(b) New ratio – old ration

(c) Both of the above

(d) None of the above

Answer (a) Old ratio – New ratio

4. On the admission of a partner if the goodwill is raised at full value, it should be debited to…..

(a) Goodwill account

(b) Cash account

(c) Capital account

(d) None of the above

Answer (a) Goodwill account

5. Any amount to be written off after the admission of a partner is transfer to the capital account of all partners in……

(a) New profit sharing ratio

(b) Old profit sharing ration

(c) Capital ratio

(d) None of the above

Answer (a) New profit sharing ratio

6. Revaluation account is a

(a) Real account

(b) Nominal account

(c) Personal account

(d) None of the above

Answer (b) Nominal account

7. In case of retirement of partner, profit on revaluation is credited to the capital account of partner…

(a) Profit sharing ratio

(b) Equally

(c) Capital ratio

(d) None of the above

Answer (a) Profit sharing ratio

8. Revaluation account is also known as

(a) Profit and loss adjustment account

(b) Personal account

(c) Real account

(d) None of the above

Answer (a) Profit and loss adjustment account

9. Methods of valuation of goodwill is

(a) Average profit

(b) Super profit

(c) Capitalization

(d) All of the above

Answer (d) All of the above

10. In case of retirement of a partner, goodwill at its full value is credited to the accounts of…..

(a) Retiring partner

(b) Old partner

(c) New partner

(d) All partners

Answer (d) All partners

11. At the time of admission of a new partner, reserve and undistributed profit are credited to old partner capital account

 (a) New profit sharing ratio

(b) Old profit sharing ratio

(c) Capital ratio

(d) None of the above

Answer (b) Old profit sharing ratio

12. Goodwill bought in by an incoming partner in cash to join a partnership firm is share by the old partner in their

(a) New profit sharing ratio

(b) Old profit sharing ratio

(c) Capital ratio

(d) Sacrificing ratio

Answer (d) Sacrificing ratio

13. If partnership deed silent, interest allowed on partner capital account will be

(a) 5%

(b) 6%

(c) 7%

(d) Nil

Answer (d) Nil

14. The maximum number of partner in case of non-banking partnership firm is

(a) 10

(b) 15

(c) 20

(d) 25

Answer (c) 20

15. In the absence of an agreement, interest on partner loan shall be paid @….

(a) 5%

(b) 6%

(c) 7%

(d) Nil

Answer (b) 6%

16. The written form of partnership agreement is call as

(a) Partnership deed

(b) Partnership bond

(c) Both of the above

(d) None of the above

Answer (a) Partnership deed

17. Current account of partner should be open when capitals are……?

(a) Fixed

(b) Fluctuating

(c) Up and down

(d) None of the above

Answer (a) Fixed

18. In the absence of partnership deed, profit and loss will divided among the partner

(a) Profit sharing ratio

(b) Equally

(c) Capital ratio

(d) None of the above

Answer (b) Equally

19. Which partner does not have liability to share the loss incurred by the firm

 (a) Minor

(b) Sleeping

(c) Dormant

(d) None of the above

Answer  (a) Minor

20. The additional account prepared at the time of preparation of final account of partnership

(a) Profit and loss appropriation account

(b) Revaluation account

(c) Balance sheet

(d) None of the above

Answer (a) Profit and loss appropriation account