Accounting for Partnership Firms-1

A Partnership firm has four partners. How many additional partners can be admitted into the business as per the provisions of Companies Act ,2013?

• 50

• 46

• 100

• 96

In the absence of partnership deed, the profits of a firm are divided among the partners:

• in the ratio of capital

• Equally

• In the ratio of time, devoted for the firms business

• According to the managerial abilities of the partners

Which of the following items will not appear in a Partners fixed capital A/c?

• Additional capital introduced

• Interest on capital

• Opening balance of capital

• Permanent withdrawal of capital

Which of the following items, does not appear in the Profit and Loss appropriation account?

• Salaries to partners

• Interest on Capital

• Drawings

• Interest on capital

in the absence of partnership deed, partners are entitled to an interest on the amount of additional capital advanced by him to the firm at a rate of:

• Entitled for 6% per annum on their additional capital, only when there are profits

• Entitled for 10% per annum on their additional capital

• Entitled for 12% per annum on their additional capital

• Not entitled for any interest on their additional capital

Sita and Geeta are partners in a firm. The partnership agreement provides for interest on drawings at the rate 12% per annum. Which of the following accounts will be debited to transfer interest on drawings to Profit and Loss Appropriation A/c?

• Bank account

• Partner’s current account

• Partner’s capital account

• Interest on drawings account

Which of the following statements is incorrect in context of partnership?

• Fixed capital accounts always show a credit balance while fluctuating capital account may show a credit or debit balance

• Interest on Partner’s drawings is to be given at the rate 10% per annum if the partnership date is silent about the rate of interest

• Every partner, including sleeping partner will get equal share of profit in the absence of a deed

• Debit balance of a partner’s current account would indicate that the partner has been thrown in axis of what was due to him. so, it will be shown on the asset side of Balance Sheet

Interest on capital is provided to partners, when:

• Capitals are more than Rs. 5,00,000

• A loan is provided by partner

• Drawings are not made by partners

• it is provided in partnership deed

P and Q are partners in a firm. They are entitled to interest on their capitals, but the net profit was not sufficient for this interest. The net profit will be distributed between partners in:

• Agreed Ratio

• Profit Sharing Ratio

• Capital Ratio

• Equal Ratio

Current account of a partner

• Will always have a credit balance

• Will always have a debit balance

• Can never have a debit balance

• May have a debit or credit balance