F.Y B.COM
SEMESTER - 2
FINANCIAL ACCOUNTING
(FA)
MCQS - DISSOLUTION OF PARTNERSHIP FIRM
DISSOLUTION OF PARTNERSHIP FIRM
1. Realization a/c is a
(a) real a/c
(b) personal a/c
(c) nominal a/c
2. An unrecorded liability when paid on dissolution, is debited to
(a) realization a/c
(b) partners' capital a/c
(c) the liability a/c
3. On dissolution of a firm, when an unrecorded asset is realized, the debit is to the
(a) realization a/c
(b) capital a/c
(c) bank a/c
4. Provision for bad debt appearing at the time of dissolution of a firm is transferred to
(a) realization a/c
(b) sundry debtors a/c
(c) partners capital
5. The decision in Garner Vs Murray is exactly similar to
(a) sec. 48 of the partnership act
(b) sec. 41 of the partnership act
(c) sec. 44 of the partnership act
6. General reserve appearing at the time of dissolution of a firm H transferred to
(a) capital account of the partners
(b) realisation a/c
(c) neither of the two
7. Goodwill a/c is closed at the time of dissolution by transferring to
(a) capital a/c of the partners
(b) realisation a/c
(c) neither of the two
8. In the event of dissolution of a firm, if a partner takes over an asset, it should be
(a) debited to realisation a/c
(b) credited to realisation a/c
(c) credited to capital alc of the partne
9. Upon dissolution, a liability taken over by a partner is to be credited to
(a) P& L a/c
(b) Partner's capital a/c
(c) Realization a/c
10. When the realization expenses are to be borne by a partner, it is debited to:
(a) partner's capital a/c
(b) cash a/c
(c) realization a/c
11. Profit or loss on realization should be divided among partners in the
(a) profit sharing ratio
(b) equally
(c) capital ratio
12. As per the dissolution of Gamer Vs Muray, the solvent partners are to bring cash equal to their share of _________
(a) personal loss
(b) realisation loss
(c) capital loss
13. In the realisation a/c, the expenses of realisation are
(a) debited
(b) credited
(c) neither of the two
14. At the time of dissolution, all the assets of the firm are transferred to the realisation account at
(a) market value
(b) book value
(c) replacement value
15. The first step in the dissolution process is to
(a) preparea balance sheet on the date of dissolution
(b) distribute the available cash to the creditors
(c) none of these
16. The court may dissolve a firm when:
(a) a partner has become of unsound mind
(b) the business was formed for a fixed term
(c) none of these
17. At the time of dissolution of a partnership firm, which liability is to be paid first from that remaining surplus asset?
(a) Wife's Loan
(b) Partner's Loan
(c) Dissolution exp.
(d) Payment of third party
18. From the realisation of firm's assets after dissolution, which of the following liabilities is paid last?
(a) Dissolution exp.
(b) Payment to third party
(c) Increase in Capital
(d) Wife's loan
19. At the time of dissolution of partnership firm, what will be the accounting effect of Bad debts return?
(a) Cash A/c. Cr.
(b) Realisation A/c Dr.
(c) Realisation A/c Cr.
(d) No effect
20. At the time of dissolution, the Goodwil is Rs. 50,000 in Balance sheet. No specification has been given regarding it. what will be the effect.?
(a) Realisation A/c Cr.
(b) Cash A/c Dr.
(c) No Effect
(d) partner's capital A/c Cr.
21. At the time of dissolution, no Goodwill was seen in Balance Sheet still there is surplus amount of Rs. 50,000 of Goodwill. What effect will be given to it ?
(a) Realization A/c Cr.
(b) Cash A/c Cr.
(c) Goodwill A/C Dr.
(d) No effect
22. At the time of dissoultion, what will be the effect of investment fluctuation fund?
(a) Realization A/c Cr.
(b) Invesetment A/c Cr.
(c) Realisation A/c Dr.
(d) Partner's capital A/c Cr.
23. At the time of dissolution Rs. 20,000 for machinary is shown in Balance Sheet. No specification regarding its realisation has been made. What will be its accounting effect?
(a) Partner's capital A/c Cr.
(b) No effect
(c) Cash A/c Cr.
(d) Realization A/c Cr.
24. At the time of dissolution, if any partner accepts the liability to bear dissolution expenses of Rs. 8,000, what will be the accounting effect?
(a) Realisation A/c Dr.
(b) Realization A/c Cr.
(c) Partner's capital A/c Dr.
(d) No effect
25. At the time of dissoultion, Rs. 5,000 realised for unrecorded furniture when it was sold which account will it be credited to?
(a) Cash Account
(b) Partner's capital A/c
(c) Realisation A/c
(d) Partner's Current A/c
26. At the time of dissolution, unrecorded outstanding salary of Rs.10,000 is being paid. Where will it be credited?
(a) Realization A/c Dr.
(b) Partner's Capital A/c
(c) Salary A/c
(d) Cash A/c
27. At the time of dissolution, what will be the effect of credit balance of Profit and Loss A/c?
(a) Realisation A/c Dr.
(b) Realization A/c Cr.
(c) Parther's Capital A/c Dr.
(d) Partner's Capital A/c Cr
28. At the time of dissoultion, unrecorded investments are Rs.12,000. It has been paid to unrecorded creditors and account is closed. what will be the accounting effect?
(a) Realization A/c Dr.
(b) Realisation A/c Cr.
(c) No Effect
(d) Cash A/c Dr.
29. At the time of dissolution, In Balance Sheet, Debtors A/c was Rs. 8,000 and Bad Debts Reserve A/c was Rs. 800. What will be written on the credit side of Realisation A/c?
(a) Rs.800
(b) Rs.7,200
(c) Rs.8,000
(d) Rs.8,800
30. It was decided to pay Rs.1,200 to Mr. Modi for dissoultion expense, but actual dissolution expense was Rs.800. What amount will be written on the Dr. side of Realisation A/c?
(a) Rs.1,200
(b) Rs.800
(c) Rs.400
(d) Rs.2,000
31. To which account are the dissolution expenses debited?
(a) Profit and Loss A/c
(b) Profit and Loss Adjustment A/c
(c) Profit and Loss Appropriation A/c
(d) Realisation A/c
32. What is the liability of the partners?
(a) Limited
(b) Unlimited
(c) Limited upto their capital
(d) Limited upto closing capital
33. Which account is opened to close assets and liabilities accounts when a firm is dissolved?
(a) Revaluation Account
(b) Realisation Account
(c) Dissolution Account
(d) Memorandum Revaluation Account
34. To which account is the profit or loss on realization account transferred on dissolution of a firm?
(a) To Partners' Loan A/c
(b) To Partners Capital Accounts
(c) To Revaluation A/c
(d) To Profit and Loss Adjustment A/c
35. On dissolution, assets and liabilities are transferred to Realization account at their _______ values.
(a) market
(b) book
(c) original
(d) realised
36. The partner who is unable to pay his liabilities is called an /a ________ parther.
(a) solvent
(b) insolvent
(c) doubtful
(d) working
37. In the case of dissolution of a firm, when a partner takes over an outside liability ________ A/c is debited.
(a) Revaluation
(b) Realisation
(c) Partner's Capital
(d) Partner's Loan
38. Which type of account is Realisation A/c?
(a) Personal Account
(b) Real Account
(c) Nominal Account
(d) Special Account
39. Normlly the realisation expense is paid by the _______
(a) court
(b) all partners
(c) solvent partner
(d) firm
40. The debit balance on Realization A/c indicates ______
(a) Profit on realisation
(b) Loss on realisation
(c) Capital deficiency
(d) Asset of the firm
41. Which type of partner can take over an asset or a liability at the time of dissolution of the firm?
(a) Solvent partner
(b) Insolvent partner
(c) Silent partner
(d) Working partner
42. At the time of dissolution of partnership firm, the general reserve account is transferred to..
(a) Partners' Capital A/c
(b) Profit and Loss A/c
(c) Realisation A/c
(d) Balance sheet
43. ________ means winding up of partnership firm.
(a) Reconstruction of partnership
(b) Admission of a new partner
(c) Retirement or Death of a partner
(d) Dissolution of partnership
44. On dissolution of a firm, the assets and liabilities are transferred to the ________ Account.
(a) Revaluation
(b) Realisation
(c) Partner's Capital
(d) Partner's Drawings
45. Books of account shows the balance of Rs. 10,000 for intangible asset (e.g. Goodwill, copyright) If instruction is not given regarding its disposal then which effect would be passed ?
(a) No account effect is to be passed
(b) Realise amt. credited to Partners Capital A/c
(c) Realised amt. credited to Realisation Account
(d) Realised amt. debited to Partners Capital A/c
46. At the time of dissolution, machinery is shown at Rs. 30,000 in the B/s. But nothing is mentioned regarding its realisation. What will be the effect for this ?
(a) Realisation A/c. Cr. side
(b) No accounting effect is required
(c) Cash A/c. Dr. side
(d) Partners Capital A/c. Cr. side
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