Introduction to Partnership Accounts-Test 3

The business of the firm can be conducted even by one partner.

The profit sharing ratio of the partners of the new firm depends on the sacrificing ratio of the old partners.

Interest loans and advances given to the firm attracts interest @ 6% p.a.

Profit and loss appropriation account indicates distribution of profit (or losses after adjusting interest on capitals, drawings and salaries of partners.

If omission of past period are detected the adjustment is to be done in partners capital account through profit and loss adjustment A/c.

Interest on drawing is loss to the partnership firm.

It is compulsory for a partner to contribute capital

Goodwill is not fictitious asset.

Super profit is a positive difference between average profit and normal profit.

The amount of super profit is always less than the amount of actual profit.

Goodwill is valued at the end of every accounting year.

Mr. A and Mr.B started Business on 1st April 2006. Calculate the Interest on Drawings of Mr.B @10% p.a. for the year ended 31st Dec.2006. If he withdrew Rs.1,200 p.m.

The partnership deed provides for a salary of Rs.700 Per month to partner X, if X withdraws only Rs.500 in a month, the remaining Rs.200 is,

If the partnership deed provides for a salary of Rs.1,000 p.m. to a partner A, who withdraws only Rs.800 in a month, the remaining Rs.200 would be

Mr. A and Mr.B started Business on 1st April 2006 with capitals of Rs.5,00,000 and Rs.3,00,000 respectively. There is no withdrawal or addition of capital during the year. Calculate the interest on capital @ 12% p.a. if the books of accounts are closed on 31st March.

In the absence of specific provisions in the partnership deed, partners are not entitled to any interest on capital, salary and remuneration.

Interest on drawing is credited to partners current/capital accounts.

Current accounts always indicate credit balances.

Under fluctuating capital method, any withdrawal of capital will appear on the credit side of the capital account.

Change is profit sharing ratio requires compensation to the loosing partners in the form of share of goodwill.

Active partners are allowed a salary while financing partners are allowed interest on capital

The current account of a partner cannot appear on the assets side of Balance sheet.

Goodwill is an intangible asset of the business.

Goodwill is a tangible asset of a business.

At the time of calculation of the average profit, the losses are ignored.

Mr. A and Mr. B started Business on 1st April 2006. Calculate the Interest on Drawing of Mr.B @ 10% p.a. for the year ended 31st Dec.2006. If he withdrew Rs.3,600 p.m. at the end of every quarter.

Mr. A and Mr. B started Business on 1st April 2006. Calculate the Interest on Drawings of Mr. B @ 10% p.a. for the year ended 31st Dec 2006. If he withdrew Rs.3,600 in the beginning of every quarter

If his drawings during the year were Rs.24,000

Capital employed in a business is Rs.1,50,000. Profits are Rs.50,000 and the normal rate of profit is 20%. The amount of goodwill as per Capitalisation Method would be

P,Q and R are partners sharing profit equally. Partners and goodwill appearing in the books at Rs.3,000 is valued at Rs.6,000. P will get credit of