Question : A,B and C are partners sharing profits in the ratio of 3:2:1. C died on 1st July, 2023. On this date, final accounts were prepared to ascertain profits for the period. It resulted in a profit of 1,75,000 to the firm. To give effect to the above:
Option 1: Profit and Loss Account will be debited.
Option 2: Profit and Loss Appropriation Account will be debited.
Option 3: Profit and Loss Account will be credited.
Option 4: Profit and Loss Appropriation Account will be credited.
Correct Answer: Profit and Loss Appropriation Account will be debited.
Solution : In case of death of a partner. the profit upto the death of partner is transferred to Profit & Loss Suspense A/c. But in the absence of Profit & Loss A/c, such profit is transferred to the Profit & Loss Appropriation A/c.
Question : When debentures are issued at premium and redeemed at premium, the journal entry will have the following combination:
(A) Discount on issue of debentures account is credited
(B) Loss on issue of debentures account is debited
(C) Security premium account is credited
(D) Premium on redemption of debentures account is credited
Option 1: (A), (B) and (D) only
Option 2: (A), (B) and (C) only
Option 3: (A), (B), (C) and (D)
Option 4: (B), (C) and (D) only
Question : The adjustment required for overvaluation of closing stock, while calculating adjusted profit for calculate goodwill is
(A) reduction from concerned year's profit.
(B) reduction from next year's profit.
(C) addition to next year's profit.
(D) addition to previous year's profit
Choose the correct answer from the options given below:
Option 2: (A) and (C) only
Option 3: (A) and (D) only
Option 4: (B), (C) and (D) only.
Question : Arrange the following in the correct order:
(A) Subscribed Capital
(B) Issued Capital
(C) Authorised Capital
(D) Paid-up Capital
(E) Called-up Capital
Option 1: (C), (B), (A), (D), (E)
Option 2: (B), (C), (A), (D), (E)
Option 3: (C), (B), (A), (E), (D)
Option 4: (B), (C), (A), (E), (D)
Question : The journal entry for treatment of goodwill, when a new partner brings his share of goodwill in cash and one of the old partners gains, involves the following :
(A) Gaining Partner's Capital Account is debited
(B) Premium for Goodwill Account is debited
(C) Sacrificing Partner's Capital Account is credited
(D) Gaining Partner's Capital Account is credited
Question : Arrange the following in the correct sequence in the context of debenture.
(A) Payment to debenture-holders
(B) Creation of DRR
(C) Issue of debentures
(D) Redemption becomes due
Option 1: (A), (B), (C), (D)
Option 2: (A), (C), (B), (D)
Option 3: (B), (A), (D), (C)
Option 4: (C), (B), (D), (A)
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