2. A partners has to pay interest on drawings what is the entry in the personal A/c of the
partner?
Correct : D. debit partners current a/c
3. Salary paid to partner should be:
Correct : D. none of above
4. Interest on capital Account:
Correct : C. debit to profit & loss and credited to partners capital a/c
5. At the time of admission of a new partner the firm is:
Correct : A. dissolved
6. At the time of admission an incoming partner contributes as goodwill:
Correct : C. may or may not pay cash for goodwill
7. Goodwill is valued as two years purchase of the average profits of three previous years
are Rs. 15000, the value of goodwill be:
Correct : B. rs. 30000
8. Value of goodwill agreed upon Rs. 30000 on C, S admission and allowing him ¼ share
of total profit Goodwill is brought in cash, the amount of goodwill be as:
Correct : B. rs. 7500
9. Goodwill of the firm is valued Rs. 30000. C an incoming partner purchase ¼ share of total
profit Goodwill be raised in the books.
Correct : A. rs. 30000
10. 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:
Correct : C. according to sacrifice ratio
11. At the time of admission of a new partner, general reserve is:
Correct : B. credited to capital of old partners
12. A new partner may be admitted to a partnership:
Correct : A. with the consent of all partners
13. At the time of a new partner Goodwill:
Correct : C. belongs only to the old partner who have credited it
14. In the revaluation account a decrease in the value of plant and machinery:
Correct : A. appears on the debit side
15. In the revaluation account an increase in the value of land and building:
Correct : B. appears on the credit side
16. The partnership may come to an end due to the:
Correct : D. all of the above
17. In case of retirement of a partner full good will is credited to the accounts of:
Correct : A. all partners
18. Revaluation account is operated to find out gain or loss at the time of:
Correct : D. all of above
19. Partners equity is effected due to:
Correct : D. all of above
20. The accounting procedure at the retirement of partner is valued:
Correct : D. all of above
21. If the remaining partner want to continue the business, after the retirement of a partner, a
new partnership agreement:
Correct : A. necessary
22. An account operated to ascertain the loss or gain at the death of a partner is called:
Correct : B. revaluation account
23. Amount due to outgoing partner is shown in the balance sheet as his:
Correct : D. loan
24. The loss or gain an account of revaluation at the time of retirement of a partner is shared
by:
Correct : C. all partners
25. On the retirement of a partner any reserve being should be transferred to the capital
account of:
Correct : A. all partners in the old profit sharing ratio
26. Retirement or death of a partner.
Correct : A. is dissolution of partnership agreement
27. If all the partners, but one are insolvent it is:
Correct : B. dissolution of firm
28. If all the partners, but one, are solvent it is:
Correct : B. dissolution of firm
29. At the time of dissolution:
Correct : C. non cash assets are transferred to realization a/c
30. At the time of dissolution non – cash assets are credited with:
Correct : B. book value
31. If a partner takes over an asset of the firm, his capital account:
Correct : A. will be debited with the amount as agreed
32. Loss on realization is distributed among partners:
Correct : A. according to profit and loss ratio
33. Loss on realization is:
Correct : A. debited to partners capital a/c
34. When all partners are insolvent creditors will be:
Correct : B. paid rate ably
35. The persons who have entered into a partnership business are individually called:
Correct : A. realization a/c
36. The persons who have entered into a partnership business are individually called:
Correct : C. partners
37. If no provision is made in agreement regarding the duration of the partnership:
Correct : B. partnership at will
38. A person who declares by word of mouth as partner of the firm is called:
Correct : B. estople partner
39. A person who receives a share of profits from one of the regular partner is called:
Correct : D. sub – partner
40. The agreement among partners which set out the terms on which they had agreed to form
a partnership is called:
Correct : A. partnership deed
41. Every partner has a right to be consulted in all matters affecting the business of:
Correct : B. partnership
42. For the firm interest on drawing is:
Correct : B. income
43. A credit balance on a partner’s current A/c is.
Correct : B. part of capital
44. Old profit sharing ratio minus new profit sharing ration is equal to:
Correct : A. sacrificing ratio
45. 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):
Correct : B. 6 months
46. For any decrease in the value of liability, revolution A/c is to be:
Correct : B. credited
47. Revolution A/c is a:
Correct : D. nominal a/c
48. When good will is brought in cash by new partner, method is known as:
Correct : A. premium method
49. Section 37 of partnership act provided interest on the amount left by retiring or decreased
partner at:
Correct : C. 6%
50. When a partner dies, firm will receive the:
Correct : D. full amount of policy
51. At the time of dissolution all the assets of firm are transferred to the realization A/c:
Correct : B. book value
52. Balance of realization A/c is transferred to the capital A/c of the partners in:
Correct : B. profit sharing ratio
53. The decision is Garner Vs Murray was given in:
Correct : A. 1904
54. When an asset is acquired on hire purchase system, the asset account is debited with
_______ of the assets in the books of the hire purchaser.
Correct : B. cash price
55. If the firm stops making repayments and the goods or assets are taken away from them as
a result, this is known as:
Correct : C. repossession
56. On the balance sheet of a company, the value of the asset bought through hire purchase
will appear as:
Correct : D. cost less depreciation to date
57. The depreciation on an asset purchased through hire purchase should be:
Correct : B. based on the cost price of the asset only
58. The interest charged on the hire purchase should appear in the profit and loss account in
what manner?
Correct : B. the interest charged in that period only should be included
59. Ownership of goods under hire purchase agreement is transferred at the time of:
Correct : C. payment of last instalment
60. Which of the following does not give a difference between a hire purchase and a normal
purchase?
Correct : C. quality of asset purchased
61. The act of buying an asset without having to make full payment in the immediate future
is known as:
Correct : A. hire purchase
62. The amount of interest is credited by the buyer to ________
Correct : B. hire vendor account
63. The depreciation in the books of buyer is charged on _________
Correct : D. cash price
64. Hirer charges depreciation on:
Correct : B. cash price
65. What is transferred to Hirer under hire purchase system:
Correct : B. possession of asset
66. Hire Purchase Act is passed in the year
Correct : C. 1972
67. The Sale of Goods Act is applicable in:
Correct : A. credit purchases
68. Under which system, ownership is transferred on payment of final installment
Correct : A. installment system
69. Under hire purchase system the buyer is called _________
Correct : C. hire vendor
70. Under hire purchase system who has the right of sell __________
Correct : C. hire vendor
71. Under hire purchase system, the agreement can be _________
Correct : C. terminated
72. Installment system is governed by _______
Correct : B. sale of goods act
73. Under hire purchase system, the retail price of the articles is called ________
Correct : C. retail price
74. The advance amount under hire purchase system is called __________
Correct : D. down payment
75. Under hire purchase system, interest is calculated on _______
Correct : D. outstanding balance.
76. If the hire purchaser fails to make payment of any installment, it is called _______
Correct : A. default
77. If the hire vendor may take away all the goods on which there is default of installment it
is called____________
Correct : C. complete repossession
78. The hire vendor takes away only a portion of the goods on which there is default of
Installments it is called _________
Correct : B. partial repossession
79. In the books of hirer, for payment of installment hire vendor account will be ________
Correct : A. debited
80. In the books of hirer, for interest due at the end of the year hire vendor account will be
_______
Correct : B. credited
81. In the books of Hirer, the interest and depreciation account will be transferred to ______.
Correct : B. p & l account
82. Nature of hire purchase agreement is __________.
Correct : C. option to buy
83. In case of Hire-Purchase the total sum payable by the hire-purchaser as per terms in order
to complete the transactions is
Correct : C. hire-purchase price
84. Under ______ system the buyer does not get ownership of goods immediately
Correct : B. hp
85. ________ means the price at which the goods can be purchased by the hirer for ready
cash.
Correct : C. cash price
86. ________ is the initial payment made at the time of signing the hire purchase agreement
Correct : D. down payment
87. The difference between hire purchase price and the cash price is called ______
Correct : A. hire charges
88. In order to deal with the re possession the hire vendor operates an account called _______
Correct : C. goods repossessed account
89. Hire Purchase price =
Correct : B. cash price + total interest
90. Cash Price =
Correct : A. hire purchase price – total interest
91. Which of the following statement is false:
Correct : C. a shareholder is the agent of the company
92. Which of the following are the characteristics of a company
Correct : C. a company is a separate body can sue and be sued in its own name
93. Share application and allotment account is a:
Correct : A. personal account
94. Securities premium account is shown on the liabilities side of the balance sheet under the
head:
Correct : B. reserves and surplus
95. As per section 78 of the companies act, amount collected as premium on securities cannot
be utilized for:
Correct : B. purchase of fixed assets
96. The portion of the authorised capital which can be called-up only on the liquidation of the
company is called
Correct : B. reserve capital
97. Which of the following statement is false:
Correct : C. shares can be partly paid up
98. If shares are bought back out of free reserves then a sum equal to nominal value of the
shares so bought back is transferred to:
Correct : B. capital redemption reserve account (crr)
99. Maximum buy back limit in any year is ______ of total paid up equity capital and free
reserves.
Correct : A. 25%
100. Which of the following statement in false:
Correct : B. bonus shares can be issued out revaluation profit