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Q1. Goodwill is valued as two years purchase of the average profits of three previous years are Rs. 15000, the value of goodwill be:
A. Rs. 15000
B. Rs. 30000
C. Rs. 20000
D. Rs. 50000
Answer
B. Rs. 30000
Q2. Value of goodwill agreed upon Rs. 30000 on C, S admission and allowing him 1/4 share of total profit Goodwill is brought in cash, the amount of goodwill be as:
A. Rs. 30000
B. Rs. 7500
C. Rs. 150000
D. Rs. 120000
Answer
B. Rs. 7500
Q3. Goodwill of the firm is valued Rs. 30000. C an incoming partner purchase 1/4 share of total profit Goodwill be raised in the books.
A. Rs. 30000
B. Rs. 7500
C. Rs. 120000
D. Rs. 7000
Answer
A. Rs. 30000
Q4. An incoming partner pays his share of goodwill in cash, and profit sharing ration of old partner is changed, Goodwill be distributed among old partners:
A. As their old profit ratio
B. According to new ration
C. According to sacrifice ratio
D. None of these
Answer
C. According to sacrifice ratio
Q5. At the time of admission of a new partner, general reserve is:
A. Debited to capital of old partners
B. Credited to capital of old partners
C. Allowed to remain is balance sheet
D. Debited to current account
Answer
B. Credited to capital of old partners
Q6. A new partner may be admitted to a partnership:
A. With the consent of all partners
B. With the consent of two third of old partners
C. With the consent of any one of the partners
D. Without consent of old partners
Answer
A. With the consent of all partners
Q7. At the time of a new partner Goodwill:
A. Belongs to all partners, new and old
B. Belongs only to the new partners who is going to be admitted
C. Belongs only to the old partner who have credited it
D. None of the above.
Answer
C. Belongs only to the old partner who have credited it
Q8. In the revaluation account a decrease in the value of plant and machinery:
A. Appears on the debit side
B. Appears on the credit side
C. Appears on the debit side of good will account
D. Does not appear at all
Answer
A. Appears on the debit side
Q9. In the revaluation account an increase in the value of land and building:
A. Appears on the debit side
B. Appears on the credit side
C. Appears on the credit side of good will account
D. Does not appear at all
Answer
B. Appears on the credit side
Q10. The partnership may come to an end due to the:
A. Death of a partner
B. Insolvency of partner
C. By giving notice
D. All of the above
Answer
D. All of the above
Q11. In case of retirement of a partner full good will is credited to the accounts of:
A. All partners
B. Only retiring partner
C. Only remaining partner
D. None of the above
Answer
A. All partners
Q12. Revaluation account is operated to find out gain or loss at the time of:
A. Admission of a partner
B. Retirement of a partner
C. Death of a partner
D. All of above
Answer
D. All of above
Q13. Partners equity is effected due to:
A. Retirement of a partner
B. Admission of a partner
C. Death of a partner
D. All of above
Answer
D. All of above
Q14. The accounting procedure at the retirement of partner is valued:
A. Revaluation of assets and liabilities
B. Ascertaining his share of goodwill
C. Finding the amount due to him
D. All of above
Answer
D. All of above
Q15. If the remaining partner want to continue the business, after the retirement of a partner, a new partnership agreement:
A. Necessary
B. Not necessary
C. Optioned
D. None of above
Answer
A. Necessary
Q16. An account operated to ascertain the loss or gain at the death of a partner is called:
A. Realization account
B. Revaluation account
C. Execution account
D. Deceased partner A/c
Answer
B. Revaluation account
Q17. Amount due to outgoing partner is shown in the balance sheet as his:
A. Liability
B. Asset
C. Capital
D. Loan
Answer
D. Loan
Q18. The loss or gain an account of revaluation at the time of retirement of a partner is shared by:
A. Remaining partners
B. Retiring partner
C. All partners
D. None of above
Answer
C. All partners
Q19. On the retirement of a partner any reserve being should be transferred to the capital account of:
A. All partners in the old profit sharing ratio
B. Remaining partners in the new profit sharing ratio
C. Neither the retiring partner, nor the remaining partner
D. None of above
Answer
A. All partners in the old profit sharing ratio
Q20. 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
A. Is dissolution of partnership agreement
Q21. 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
B. Dissolution of firm
Q22. 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
B. Dissolution of firm
Q23. 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
Answer
C. Non cash assets are transferred to realization A/c
Q24. 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
Answer
B. Book value
Q25. 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
Answer
A. Will be debited with the amount as agreed
Q26. 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
Answer
A. According to profit and loss ratio
Q27. 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
Answer
A. Debited to partners capital A/c
Q28. 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
Answer
B. Paid rate ably
Q29. The persons who have entered into a partnership business are individually called:
A. Vender
B. Agents
C. Partners
D. A firm
Answer
C. Partners
Q30. 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)
Answer
B. Partnership
Q31. For the firm interest on drawing is:
A. Expense
B. Income
C. Liability
D. None
Answer
B. Income
Q32. 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
Answer
B. Part of capital
Q33. Upon the sale of an established business its good will:
A. Marketable value
B. Not marketable value
C. (b) and (c)
Answer
A. Marketable value
Q34. Old profit sharing ratio minus new profit sharing ration is equal to:
A. Sacrificing ratio
B. Ratio of gain
C. Capital ratio
D. None
Answer
A. Sacrificing ratio
Q35. 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
Answer
B. 6 months
Q36. 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.)
Answer
B. Credited
Q37. Revolution A/c is a:
A. Real A/c
B. Personal A/c
C. Cash A/c
D. Nominal A/c
Answer
D. Nominal A/c
Q38. 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
Answer
A. Premium method
Q39. 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
Answer
C. 6%
Q40. 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
Answer
D. Full amount of policy
Essentials of Financial Accounting BBA MCQs
- Essentials of Financial Accounting BBA MCQs Set 1
- Essentials of Financial Accounting BBA MCQs Set 2
- Essentials of Financial Accounting BBA MCQs Set 3
- Essentials of Financial Accounting BBA MCQs Set 4
- Essentials of Financial Accounting BBA MCQs Set 5
- Essentials of Financial Accounting BBA MCQs Set 7
- Essentials of Financial Accounting BBA MCQs Set 8
