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This set of Financial Accounting 2 Multiple Choice Questions & Answers (MCQs) focuses on Financial Accounting 2 Set 5
Q1 | Drawings of the partners are:
- debited to profit & loss a/c
- credited to profit & loss a/c
- credited to capital a/c
- debited to capital a/c
Q2 | A partners has to pay interest on drawings what is the entry in the personal A/c of thepartner?
- credit partners capital a/c
- credit partners current a/c
- debit the partners current a/c
- debit partners current a/c
Q3 | Salary paid to partner should be:
- debited to his current a/c
- credited to his current a/c
- credited to profit & loss appropriation a/c
- none of above
Q4 | Interest on capital Account:
- debited to profit & loss a/c
- credit to profit & loss a/c
- debit to profit & loss and credited to partners capital a/c
- only credited to partners capital a/c
Q5 | At the time of admission of a new partner the firm is:
- dissolved
- continued
- not effected
- re-organized
Q6 | At the time of admission an incoming partner contributes as goodwill:
- in cash
- does not pay cash
- may or may not pay cash for goodwill
- none of these.
Q7 | Goodwill is valued as two years purchase of the average profits of three previous yearsare Rs. 15000, the value of goodwill be:
- rs. 15000
- rs. 30000
- rs. 20000
- rs. 50000
Q8 | Value of goodwill agreed upon Rs. 30000 on C, S admission and allowing him ¼ shareof total profit Goodwill is brought in cash, the amount of goodwill be as:
- rs. 30000
- rs. 7500
- rs. 150000
- rs. 120000
Q9 | Goodwill of the firm is valued Rs. 30000. C an incoming partner purchase ¼ share of totalprofit Goodwill be raised in the books.
- rs. 30000
- rs. 7500
- rs. 120000
- rs. 7000
Q10 | An incoming partner pays his share of goodwill in cash, and profit sharing ration of oldpartner is changed, Goodwill be distributed among old partners:
- as their old profit ratio
- according to new ration
- according to sacrifice ratio
- none of these
Q11 | At the time of admission of a new partner, general reserve is:
- debited to capital of old partners
- credited to capital of old partners
- allowed to remain is balance sheet
- debited to current account
Q12 | A new partner may be admitted to a partnership:
- with the consent of all partners
- with the consent of two third of old partners
- with the consent of any one of the partners
- without consent of old partners
Q13 | At the time of a new partner Goodwill:
- belongs to all partners, new and old
- belongs only to the new partners who is going to be admitted
- belongs only to the old partner who have credited it
- none of the above.
Q14 | In the revaluation account a decrease in the value of plant and machinery:
- appears on the debit side
- appears on the credit side
- appears on the debit side of good will account
- does not appear at all
Q15 | In the revaluation account an increase in the value of land and building:
- appears on the debit side
- appears on the credit side
- appears on the credit side of good will account
- does not appear at all
Q16 | The partnership may come to an end due to the:
- death of a partner
- insolvency of partner
- by giving notice
- all of the above
Q17 | In case of retirement of a partner full good will is credited to the accounts of:
- all partners
- only retiring partner
- only remaining partner
- none of the above
Q18 | Revaluation account is operated to find out gain or loss at the time of:
- admission of a partner
- retirement of a partner
- death of a partner
- all of above
Q19 | Partners equity is effected due to:
- retirement of a partner
- admission of a partner
- death of a partner
- all of above
Q20 | The accounting procedure at the retirement of partner is valued:
- revaluation of assets and liabilities
- ascertaining his share of goodwill
- finding the amount due to him
- all of above
Q21 | If the remaining partner want to continue the business, after the retirement of a partner, anew partnership agreement:
- necessary
- not necessary
- optioned
- none of above
Q22 | An account operated to ascertain the loss or gain at the death of a partner is called:
- realization account
- revaluation account
- execution account
- deceased partner a/c
Q23 | Amount due to outgoing partner is shown in the balance sheet as his:
- liability
- asset
- capital
- loan
Q24 | The loss or gain an account of revaluation at the time of retirement of a partner is sharedby:
- remaining partners
- retiring partner
- all partners
- none of above
Q25 | On the retirement of a partner any reserve being should be transferred to the capitalaccount of:
- all partners in the old profit sharing ratio
- remaining partners in the new profit sharing ratio
- neither the retiring partner, nor the remaining partner
- none of above