R4RIN – MCQs, Mock Tests | ICSE XII MCQ Questions for Class 12 Accountancy set-2

The relation of partners with the firm is that of:

1. An owner
2. An Agent
3. An owner and an agent
4. Manager

✅ Correct Answer: 3

Liability of Partners is :

1. Limited
2. Unlimited
3. Determined by partnerships Account
4. None of these

✅ Correct Answer: 2

Partners’ current accounts are opened when their capital is:

1. Fixed
2. Fluctuating
3. Both (a) and (b)
4. None of these

✅ Correct Answer: 1

The interest on partner’s drawings is debited to:

1. Partner’s Capital A/c
2. Profit and Loss A/c
3. Drawings A/c
4. P. & L. App. A/c

✅ Correct Answer: 1

Interest on advance given to the firm is :

1. Ah appropriation
2. A gain
3. A charge
4. None of these

✅ Correct Answer: 3

Interest on loan is :

1. Operating Expense
2. Direct Expense
3. Indirect Expense
4. All of these

✅ Correct Answer: 3

Partner’s salary is debited to :

1. Trading Account
2. Profit and Loss Account
3. Profit & Loss Appropriation Account
4. None of these

✅ Correct Answer: 3

Partnership may be :

1. Limited
2. Unlimited
3. At will
4. All of these

✅ Correct Answer: 4

Partnership Deed is also called :

1. Prospectus
2. Articles of Association
3. Principles of Partnership
4. Articles of Partnership

✅ Correct Answer: 4

In which year did the Partnership Act passed ?

1. Year 1932
2. Year 1956
3. Year 1947
4. Year 1952

✅ Correct Answer: 1

Calculate interest on drawing @12% p.a. for Abhishek if he withdraw ₹ 2,000 once in month :

1. ₹ 1,440
2. ₹ 1,200
3. ₹ 1,320
4. ₹ 1,500

✅ Correct Answer: 1

The interest on capital accounts of partners under fixed capital method is to be credited to:

1. Partner’s Capital A/c
2. Profit & Loss A/c
3. Interest A/c
4. Partner’s Current A/c

✅ Correct Answer: 4

In the absence of partnership deed, the partner will be allowed interest on the amount advanced to the firm:

1. @5%
2. @6%
3. @ 9%
4. @8%

✅ Correct Answer: 2

Which one is not the feature of partnership?

1. Agreement
2. Sharing of Profit
3. Limited Liability
4. Two or more than two persons

✅ Correct Answer: 3

In the absence of partnership deed, interest on capital will be given to the partners at:

1. 6% p.a.
2. None of these
3. Real Account
4. None of these

✅ Correct Answer: 4

The interest on partners’ Capital Accounts under fluctuating method is to be credited to:

1. Profit & Loss A/c
2. Interest A/c
3. Partner’s Capital A/c
4. None of these

✅ Correct Answer: 1

The Current Account of the partners will always have:

1. Debit balance
2. Credit balance
3. Either of the two
4. None of these

✅ Correct Answer: 3

Interest on partner’s capital is calculated on:

1. Opening Capital
2. Closing Capital
3. Average Capital
4. None of these

✅ Correct Answer: 1

Preparation of partnership agreement in writing is :

1. Compulsory
2. Voluntary
3. Partly Compulsory
4. None of these

✅ Correct Answer: 2

Interest payable on the capital of the partners is recorded in:

1. Profit & Loss A/c
2. Realisation A/c
3. Profit & Loss Appropriation A/c
4. None of these

✅ Correct Answer: 3

For the firm, interest on partner’s drawings is a/an :

1. Expense
2. Income
3. Loss
4. Gain

✅ Correct Answer: 2

In the absence ofany agreement, the profits or losses of the firm are shared:

1. Equally
2. In Capital Ratio
3. In Different Proportions
4. None o these

✅ Correct Answer: 1

In partnership firm profits and losses are shared :

1. Equally
2. In the Ratio of Capitals
3. As per Agreement
4. None of these

✅ Correct Answer: 3

Profit & Loss Appropriation Account is prepared to:

1. Create Reserve Fund
2. Find out Net Profit
3. Find out Divisible Profit
4. None of these

✅ Correct Answer: 3

In an Ordinary Partnership, maximum number of partners can be:

1. 50
2. 10
3. 15
4. 20

✅ Correct Answer: 1

Which of the following is an appropriation of profit?

1. Interest on Loan
2. Interest on Capital
3. Salary
4. Rent

✅ Correct Answer: 2

When time of withdrawals are not mentioned, interest on drawings is charged :

1. for 616 months
2. for 8 months
3. for 516 months
4. for 12 months

✅ Correct Answer: 2

When drawings are made at the end of every month of certain amount, then interest will be calculated on total drawings:

1. for 616 months
2. for 6 months
3. for 516 months
4. for i month

✅ Correct Answer: 3

In the absence of partnership deed, partners are not entitled to receive:

1. Salaries
2. Commission
3. Interest on Capital
4. All of these

✅ Correct Answer: 4

If a fixed amount is withdrawn on the first day of every quarter, the interest on total drawing will be calculated :

1. for 6 months
2. for 6.5 months
3. for 5.5 months
4. for 7.5 months

✅ Correct Answer: 4

Which accounts are opened when the capitals are fixed?

1. Only Capital Accounts
2. Only Current Accounts
3. Liability Accounts
4. Capital and Current Accounts

✅ Correct Answer: 4

Goodwill is nothing more than probability that the old customer will resort to the old place. This definition of goodwill was given by:

1. Spicer and Pegler
2. ICAI
3. Lord Elton
4. AICPA

✅ Correct Answer: 3

Goodwill is to be calculated at one and half year’ purchase of average profit of last 5 years. The firm earned profits during 3 years as ₹ 20,000 ₹ 18,000 and ₹ 9,000 and suffered losses of ₹ 2,000 and ₹5,000 in last 2 years. The amount of goodwill will be :

1. ₹ 12,000
2. ₹ 10,000
3. ₹ 15,000
4. None of these

✅ Correct Answer: 1

When there is no Goodwill Account in the books and goodwill is raised,…………….account will be debited :

1. Partner’s Capital
2. Goodwill
3. Cash
4. Reserve

✅ Correct Answer: 2

The amount of goodwill is paid by new partner :

1. for the payment of capital
2. for sharing the profit
3. for purchase of assets
4. None of these

✅ Correct Answer: 2

At the time of admission of a new partners general reserve appearning in the old Balance Sheet is transferred to:

1. All Partner’s Capital Accounts
2. New Partner’s Capital Account
3. Old Partners’. Capital Accounts
4. None of these

✅ Correct Answer: 3

Profit or Loss on Revaluation is borne by:

1. Old Partners
2. New Partners
3. All Partners
4. Only Two Partners

✅ Correct Answer: 1

Share of goodwill brought by new partner in case is shared by old partners in :

1. Sacrificing Ratio
2. Old Ratio
3. New Ratio
4. Equal Ratio

✅ Correct Answer: 1

A, Band Care three partners sharing profits and losses in the ratio of 4:3:2. D is admitted for 1/10 share, the new ratio will be :

1. 10 : 7 : 7 :4
2. 5 : 3 : 2 : 1
3. 4 : 3 : 2 : 1
4. None of these

✅ Correct Answer: 3

A and B are partners in a firm sharing profits in the ratio of 3:2. They admit C as a new partner for 1/3 rd share in the profits of the firm. The new profit sharing ratio of A, B and C would be :

1. 3 : 2 : 1
2. 3 : 2 : 2
3. 3 : 2 : 3
4. 6 : 4 : 5

✅ Correct Answer: 4

X and Y are partners sharing profits in the ratio of 1:1. They admit Z for 1/5 th share who contributed ₹25,000 for his share of goodwill. The total value of goodwill of the firm will be :

1. ₹ 2,50,000
2. ₹ 50,000
3. ₹ 1,00,000
4. ₹ 1,25,000

✅ Correct Answer: 3

A, B and C are partners in a firm. If D is admitted as a new partner, then:

1. Old firm is dissolved
2. Old firm and old partnership is dissolved
3. Old Partnership is reconsitituted
4. None of these

✅ Correct Answer: 3

In which ratio, the cash brought in for goodwill by the new partner is shared by the existing partners :

1. Profit sharing ratio
2. Capital ratio
3. Sacrificing ratio
4. None of these

✅ Correct Answer: 3

Sacrificing ratio is ascertained at the time of:

1. Death of a partner
2. Retirement of a partner
3. Admission of a partner
4. None of these

✅ Correct Answer: 3

If at the time of admission of new partner, Profit and Loss Account balance appears in the books, it will the transferred to:

1. Profit & Loss Appropriation A/c
2. All Partners’ Capital A/cs
3. Old Partners’ Capital A/cs
4. Revaluation A/c

✅ Correct Answer: 3

State the ‘true’ statement:

1. Profit & Loss Adjustment A/c is prepared for revaluated of assets and liabilities on the admission of a partner
2. The new partner is liable for the past losses of the firm
3. In case the new partner is unable to bring in cash for goodwill, Goodwill Account may be raised in the firm’s books as per AS-26
4. When a partner is admitted, there is dissolution of firm

✅ Correct Answer: 1

Excess of the credit side over the debit side of Revaluation account is:

1. Profit
2. Loss
3. Gain
4. Expense

✅ Correct Answer: 1

Balance sheet prepared after new partnership agreement, assets and liabilities are recorded at:

1. Original Value
2. Revalued Figure
3. At Realisable Value
4. Either of (a) or (b)

✅ Correct Answer: 2

Assets and Liabilities are shown at their revalued values in :

1. New Balance Sheet
2. Revaluation A/c
3. All Partner’s Capital A/c’s
4. Realisation A/c

✅ Correct Answer: 1

Which of the following assets is compulsorily revalued at the time of admission of a new partner :

1. stock
2. Fixed Assets
3. Investment
4. Goodwill

✅ Correct Answer: 4