What is the amount of capital of the proprietor, if his assets are Rs. 85,000 and liabilities are Rs. 21,000?

(a)

Rs. 85,000

(b)

Rs. 1,06,000

(c)

Rs. 21,000

(d)

Rs. 64,000

Closing capital can be found by preparing a statement affairs at the _____ of the year.

(a)

opening

(b)

end

(c)

centre

(d)

none of these

If opening capital Rs. 1,000 and closing capital Rs. 2000. Assuming no drawings during the accounting period, calculated the net income or loss for the period _______

(a)

Rs.1,000 net income

(b)

Rs.1,000 net loss

(c)

Rs.2,000 net income

(d)

Rs.2,000 net loss

If opening capital is Rs.10,000 & Closing capital is Rs.15,000 then profit or loss _________

(a)

Loss of Rs.5,000

(b)

Profit of Rs.2,500

(c)

Profit of Rs.5,000

(d)

None of these

When fixed capital method is adopted by a partnership firm, which of the following items will appear in capital account?

(a)

Additional capital introduced

(b)

Interest on capital

(c)

Interest on drawings

(d)

Share of profit

Current accounts for partners will be opened under, ____________

(a)

Fixed capital method

(b)

Fluctuating capital method

(c)

Either fixed capital method or fluctuating capital method

(d)

None of these

Goodwill is shown under fixed assets in the ___________

(a)

Trial balance

(b)

Balance sheet

(c)

Trading account

(d)

Profit and loss account

Rate of interest is 11% and the rate of risk is 9% The normal rate of return is __________

(a)

11%

(b)

9%

(c)

20%

(d)

2%

Which of the following statements is not true in relation to admission of a part _________.

(a)

Generally mutual rights of the partners change

(b)

The profits and losses of the previous years are distributed to the old partners

(c)

The firm is reconstituted under a new agreement

(d)

The existing agreement does not come to an end

On admission of a partner if goodwill account is to be raised this should be debited to __________

(a)

Partner's capital account

(b)

Partner's capital account

(c)

Revaluation account

(d)

None of these

________ ratio is the proportion of the profit which is sacrificed or foregone by the old partners in favour of the new partner.

(a)

Old

(b)

New

(c)

Sacrifice

(d)

Agreed

At the time of admission of a new partner, revaluation of ______ and _______should be taken up.

(a)

Capital & Assets

(b)

Capital & Liabilities

(c)

Assets & Liabilities

(d)

Income & Expenses

A partner who is newly admitted to the firm with the consent of all the parties is called _________

(a)

Salaries Partner

(b)

Incoming partner

(c)

Junior partner

(d)

Minor partner

If the final amount due to a retiring partner is not paid immediately, it is transferred to

(a)

Bank A/c

(b)

Retiring partner’s capital A/c

(c)

Retiring partner’s loan A/c

(d)

Other partners’ capital A/c

The amount due to the________partner is either paid off immediately or is paid in instalments.

(a)

Admitting

(b)

Retiring

(c)

Death

(d)

All of the above

Hari, Roy and Prasad are partners in the ratio of 3:5:1 respectively. Roy wants to retire. His share is being purchased by Prasad. What would be the new ratio of Hari and Prasad respectively?

(a)

1:2

(b)

2:1

(c)

3:5

(d)

Equal

The method under which amount payable to the retiring partner is paid off at a time ___________

(a)

Immediately paid method

(b)

Lump-sum method

(c)

Both (a) & (b)

(d)

None of these

Which of the following statement is false?

(a)

Issued capital can never be more than the authorised capital

(b)

In case of under subscription, issued capital will be less than the subscribed capital

(c)

Reserve capital can be called at the time of winding up

(d)

Paid up capital is part of called up capital

The term ‘fund’ refers to

(a)

Current liabilities

(b)

Working capital

(c)

Fixed assets

(d)

Non-current assets

To test the liquidity of a concern, which of the following ratios are useful?
(i) Quick ratio
(ii) Net profit ratio
(iii) Debt-equity ratio
(iv) Current ratio
Select the correct answer using the codes given below:

(a)

(i) and (ii)

(b)

(i) and (iv)

(c)

(ii) and (iii)

(d)

(ii) and (iv)