PARTNERSHIP ACCOUNTS.

1 X and Y are in partnership sharing profits and losses equally. The following 8 Rajid and Sunil formed a partnership on 1 January 2010 but did not prepare a
information was extracted from their financial records at 31 December. partnership agreement. They provided the following information.

The profit for the year was $24 200.

What was Y’s share of the residual profit? [May/June 2013/11 Q.23]
They decide to draw up a partnership agreement for future years.
A $8900 B $10 200 C $12 900 D $14 000
Which of the following adjustments to the partnership agreement would be most
beneficial to Rajid in 2010? [May/June 2011/12 Q.21]
2 Two traders are considering forming a partnership.
A interest on capital B interest on drawings
Which statement is not correct? . [May/June 2012/11 Q.23]
C limit on annual drawings D partnership salaries
A Both partners may have limited liability.
B Both partners may take an active part.
9 A partnership agreement states that interest on drawings will be charged.
C Partners may share their experience.
How is this recorded? [Oct/Nov 2011/12 Q.21]
D Partners may share their knowledge.

3 Amina and Sabena are in partnership.

How is interest on drawings recorded in the ledger? [May/June 2012/12 Q.24]
A credit capital account B credit current account
C debit capital account D debit current account

4 Interest on capital and interest on drawings compensate which partner?

[Oct/Nov 2012/11 Q.23]
A one with higher capital and higher drawings.
B one with higher capital and lower drawings.
C one with lower capital and higher drawings.
D one with lower capital and lower drawings.
5 Which group contains only advantages of being in partnership?
[Oct/Nov 2012/12 Q.23]
A additional finance is available, profits are shared, action by one partner binds the
others
B additional finance is available, responsibilities are shared, losses are shared
C losses are shared, action by one partner binds the others, risks are shared
D responsibilities are shared, profits are shared, risks are shared
6 A partner is entitled to interest on his capital.
How is this recorded in the personal account of the partner? [Oct/Nov 2012/12 Q.24]
A credit partner’s capital account B credit partner’s current account
C debit partner’s capital account D debit partner’s current account
7 What is the purpose of a partnership appropriation account? [May/June 2010/12 Q.19]
A to avoid disagreements between the partners
B to calculate residual profits for division between partners
C to calculate the profit sharing ratio
D to determine the amount of partners’ salarie
8 What is the purpose of a partnership appropriation account?
A to calculate partners’ salaries[Oct/Nov 2008/01 Q.23]
B to record partners’ drawings
C to show the distribution of profits between partners
D to show the movement on partners’ capital accounts
10 A partner had a debit balance on his current account of $1600 on 1 January 2009.
On 31 December 2009 the following amounts were entered in the partner’s current account:
interest on capital $500
share of profit $4000
What was the balance on the partner’s current account on 1 January 2010? [May/June 2010/12 Q.20]
A credit $1900 B credit $2900 C debit $5100 D debit $6100
11 Winston is a sole trader. He is considering admitting Dexter as a partner.
What would be a disadvantage to Winston if a partnership is formed? [May/June 2009/01 Q.24]
A Business losses will be shared.
B Business profits will be shared.
C More capital may be available.
D More skills and experience may be available.
12 William is a sole trader. He wants to expand his business and invites Peter to become a
partner. What is a disadvantage to William of forming a partnership? [May/June 2008/01 Q.22]
A The losses of the business will be shared.
B The profits of the business will be shared.
C The responsibility for the debts of the business will be shared.
D The responsibility for managing the business will be shared.