COCEDUCATION.

COM MCQ Series CA/CMA Santosh kumar

Fundamental of Partnership

1. …………. is prepared by partnership firm to distribute profit among partners.

a. profit and loss account
b. trading account
c. profit and loss appropriation account
d. capital account

2. while preparing financial statement of partnership firm, ……….is prepared after preparing profit & loss
A/c.
a. profit and loss appropriation account
b. trading account
c. Balance sheet
d. capital account.

3. partnership is defined by ……………..

a. Indian partnership act 1932, section 2
b. Indian partnership act 1932, section 4
c. companies act 2013, section 4
d. Indian partnership act 1932, section 30

4. According to section 4 of Indian partnership Act 1932, "Partnership is the relation between persons who have
agreed to share the profits of a business carried on by all or ………………."

a. all of them acting for all.

b. any of them acting for all.
c. any one of them acting for all.
d. any of them acting for one.

5. ------- are shown in profit and loss appropriation account.

a. charge against profit.
b. appropriation of profit.
c. both
d. none of the above.

6. The written document known as ………….. details the terms and conditions of partnership.

a. partnership agreement.
b. partnership deed.
c. partnership act 1932
d. notary agreement

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7. Interest on drawing is -------- in profit and loss appropriation account.

a. debited
b. credited
c. no treatment
d. none of above

8. Partner’s drawing is -------- in profit and loss appropriation account

a. debited
b. credited
c. no treatment
d. none of above

9. Salary of manager is recorded in………..

(a) Trading A/c
(b) Profit & loss A/c
(c) Profit loss App A/c
(d) Balance sheet

10. Salary to partner is recorded in-------

(a) Trading A/c
(b) Profit & loss A/c
(c) Profit loss App A/c
(d) Balance sheet

11. Interest on loan to partner is debited to………..

(a) Trading A/c
(b) Profit & loss A/c
(c) Profit loss App A/c
(d) Balance sheet

12. Interest on capital is credited to ……

(a) Profit & loss A/c
(b) Profit loss App A/c
(C) Partners’ capital account.
(c) None of the above

13. Rent to partner for using his property in business is debited/transferred to ……..
(a) Trading A/c
(b) Profit & loss A/c
(c) Profit loss App A/c
(d) Balance sheet

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14. Transfer to General reserve is debited to…….

(a) Trading A/c
(b) Profit & loss A/c
(c) Profit loss App A/c
(d) Balance sheet.

15. Net profit before interest on loan and tax ₹ 4,00,000

Interest on partner’s loan ₹ 50,000
Tax rate 30%
Manager’s commission 10% of net profit.
Calculate manager’s commission.
a. ₹35,000
b. ₹24,500
c.. ₹40,000
d. ₹22,273
16. Net profit before interest on loan ₹ 4,00,000
Interest on partner’s loan ₹ 50,000
Manager’s commission 10% of net profit after charging such commission.
Calculate manager’s commission.
a. ₹35,000
b. ₹31818
c.. ₹40,000
d. ₹38,889
17. net profit before manager’s commission and interest on loan ₹6,00,000.
Manager’s commission ₹ 80,000
Interest on loan to partners ₹ 70,000
Interest on capital to partners ₹40,000.
Journal entry for transferring net profit to profit and loss appropriation account.
(a) profit and loss account Dr 6,00,000
To profit and loss appropriation A/c 6,00,000
(b) profit and loss account Dr 4,50,000
To profit and loss appropriation A/c 4,50,000

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(c) profit and loss account Dr 4,10,000

To profit and loss appropriation A/c 4,10,000
(d) profit and loss account Dr 5,20,000
To profit and loss appropriation A/c 5,20,000

18. Net profit before manager’s commission = ₹ 2,20000

Manager’ commission = 10% of net profit after such commission
Calculate commission.
a. 20,000
b. 22,000
c. 24,444
d. none of the above

19. Profit before rent to a partner = ₹ 5,00,000

Rent payable to partner = ₹ 40,000
Salary payable to partner = ₹ 60,000
10% of net profit is to be transferred to General reserve
A. ₹ 46000
B. ₹50,000
C. ₹40,000
D. 41,818

20. Profit before rent to a partner = ₹ 5,00,000

Rent payable to partner = ₹ 40,000
Salary payable to partner = ₹ 60,000
10% of distributable profit is to be transferred to General reserve
A. ₹ 46000
B. 50,000
C. ₹40,000
D. 41,818

21. Profit before rent to a partner = ₹ 5,00,000

Rent payable to partner = ₹ 40,000
Salary payable to partner = ₹ 60,000
10% of distributed profit is to be transferred to General reserve
A. ₹ 46000
B. 50,000
C. ₹40,000
D. 41,818

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COCEDUCATION.COM MCQ Series CA/CMA Santosh kumar
22. A and B are partners sharing profit and losses as follow:
Salary to A ₹ 30,000
Provision of 5% of net profit to be made for commission to manager.
Net profit after A’s salary = ₹1,20,000
Calculate amount of profit to be transferred from profit & loss A/c profit & loss appropriation A/c.
A. ₹1,20,000
B. ₹1,50,000
C. ₹1,42,500
D. ₹1,14,000

23. Journal entry for transferring net loss from profit & loss A/c to profit & loss appropriation A/c.
A. Profit & loss A/c Dr.
To Profit & loss appropriation A/c.
B. Profit & loss Appropriation A/c Dr.
To Profit & loss A/c.
C. Profit & loss A/c Dr.
To Partner’s capital account.
D. none of the above

24. Appropriation of profit is debited to _________

A. profit and loss account
B. profit and loss appropriation account.
C. partner’s capital account
d. none of the above.

25. Change against profit are debited to __________.

A. profit and loss account
B. profit and loss appropriation account.
C. partner’s capital account
d. none of the above.

26. Partnership comes into existence by ------- .

(a) an Oral agreement
(b) a Written agreement
(c) an oral or a written agreement
(d) no idea

27. In the absence of partnership deed, interest on capital is allowed at the rate of :
(a) 6% p.a.
(b) 6%
(c) nill
(d) 12% p.a.

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28. In the absence of partnership deed, ---- interest on drawings will be charged @:

(a) 6% p.a.
(b) 6%
(c) nill
(d) 12% p.a.

29. In the absence of partnership deed, interest on loan will be allowed @

(a) 6% (b) 6% p.a. (c) 12% (d) Nill

30. On 1 July 2021, partner had given a loan of ₹ 2,00,000 to the firm. Calculate interest on loan @ 10% p.a.
for the year ended on 31.3.2022.

A. 20,000 B. 10,000 C. 15,000 D. 9,000

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