Question :
Assertion (A) : Rajiv and Vinod, who share the profit and losses in 2 : 3, are dissolving the firm. There is a general reserve in the balance sheet of Rs.60000. The accountant transferred Rs.24000 in Rajiv's capital account and Rs.36000 in Vinod's capital account.
Reason (R) : The undistributed profit and losses and reserves are always transferred to partners' capital account in their profit sharing ratio and not to the realisation account.
Option 1: Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct eplanation of Assertion (A).
Option 2: Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct eplanation of Assertion (A).
Option 3: Assertion (A) is true, but Reason (R) is false
Option 4: Assertion (A) is false, but Reason (R) is true.
Correct Answer: Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct eplanation of Assertion (A).
Solution : Since capital is an investment made by the partners themselves, the firm will only return the capital to the partners at the time of a partner's dissolution once all other debts, including any loans made in proportion to the partners' capital, have been settled.
Hence the Correct answer is option 1.
Question : Assertion A:- In many situations, the accountant has to make a choice out of alternatives available, e.g., choice in the method of inventory valuation, choice in the method of depreciation (straight line or written down value)
Reason R: - The subjectivity is inherent in personal judgment, the financial statements are, therefore, not free from bias. It is a limitation of financial statements.
Option 1: Both Assertion A and reason R are correct but reason R is not the correct explanation of Assertion A
Option 2: Both Assertion A and reason R are correct but reason R is the correct explanation of Assertion A
Option 3: Both Assertion A is correct but the reason R is not correct
Option 4: Both Assertion A and reason R are not correct
Question : The ratio of Current Assets (Rs.16,00,000) to Current Liabilities (Rs.10,00,000) is 1.6: 1. The accountant of the firm is interested in maintaining a Current Ratio of 2: 1, by paying off a part of the Current Liabilities. The amount of the Current Liabilities will be that should be paid, so that the Current Ratio at the level 2: 1 may be maintained.
Option 1: Rs 4,00,000
Option 2: Rs 5,00,000
Option 3: Rs 8,00,000
Option 4: Rs 10,00,000
Question : The ratio of Current Assets (Rs.3,00,000) to Current Liabilities is Rs.2,00,000 then the ratio is 1.5:1. The accountant of this firm is interested in maintaining a Current Ratio of 2:1 by acquiring some Current Assets on Credit. The amount of Current Assets which must be acquired for this purpose.
Option 1: Rs 1,00,000
Option 2: Rs 50,000
Option 3: Rs 1,50,000
Option 4: Rs 2,00,000.
Question : Ram is the personal manager of X limited company. He have been directed by the directors of the company to select a chartered accountant for the company. Which of the following process he will choose?
Option 1: Recruitment
Option 2: Selection
Option 3: Training
Option 4: None of the above
Question : Fardeen Ltd. received interest on an item and the accountant classified it unde Investing Activity while preparing Cash Flow Statement. Name another item for which such a treatment is possible.
Option 1: Dividend paid
Option 2: Dividend received
Option 3: Issue of equity shares
Option 4: Interest on call - in arrear
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