Question

1.

The right side of a T-account is used to record

Select one:

a. Decrease in revenue

b. Increase in Asset

c. Decrease in liability

d. Increase in Liability

2.

Odd-man Out.
Choose the letter that does not belong to the group.

Select one:

a. Interest Income

b. NSF check

c. Notes Receivable collected by banks in behalf of the depositor

d. Proceeds of bank loan deposited in the account of the depositor

3,

Any retiring partner may do any of the following except

Select one:

a. Sold his interest to the any of the remaining partners.

b. Sold his interest to outsider without the consent of the partners.

c. Sold his interest to the partnership.

d. Transfer his interest to any member of his family.

4.

The profit and loss ratio of partners A and B of 2:3 means that the share of A is equivalent to

Select one:

a. 2%

b. 60%

c. 20%

d. 40%

5.

Odd-man Out.
Choose the letter that does not belong to the group.

Select one:

a. Trial Balance

b. Balance sheet

c. Worksheet

d. T-Accounts

6.

Which is not true?

Select one:

a. The industrial partner should not be sharing in the profits of the partnership if he is receiving a separate salary.

b. Salaries to partners and interest on capital can be a way of dividing net income of the partnership.

c. A person who is not receiving a share in the profit of a partnership is not a partner.

d. A partnership can have no stated agreement on how to divide losses.

Answer 1

1. Correct option is (d) To increase the liability.

Liabilities are recorded at the credit side. (for eg Purchases Dr. To Creditors)

Hence any increase shall be recorded on the right side of T account.

2. Correct option is (b) NSF Check

Interest income, Notes Receivable collected by banks and Proceeds of bank loan deposited in the account of the depositor are the reflected as credit entries in a pass book thus increasing bank balance hence NSF check does not increase the bank balance

3. Correct option is (b) that a retiring partner can sell his interest to outsider without consent of other partners.

Selling the interest to other partner or partnership or to any member of the own family will not hamper the partnership in such a way but adding other partner without the consent of old partners will definitely is a matter of concern (Uniform Partnership Act)

4 Correct option is (d) 40%

As 2:3 means the profits shall be divided by A in ratio of 2/5 of profits.

2/5 multiplied by 20 on numerator and denominator gives 40/100 which means 40%

5 Correct option is (c) worksheets

Balance sheets are prepared with the help of trial balance and such trial balance is prepared by closing balances of T account ledgers. hence worksheet is odd one out

6 Correct option is (c) person who is not receiving a share in the profit of a partnership is not a partner.

As per Uniform Partnership act, Partners are co owners who share the profits. hence any person not getting share in profits will not be termed as a partner