Question 1.
In the event of dissolution of partnership firm, the provision for doubtful debts is transferred to :
(a) Realisation Account
(b) Partners’ Capital Accounts
(c) Sundry Debtors Account
(d) None of the above

Answer

Answer: (a) Realisation Account

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Question 2.
On dissolution, if a partner undertakes to make payment of a liability of the firm, the account to be debited is:
(a) profit & Loss Account
(b) Realisation Account
(c) Partner’s Capital Account
(d) Cash Account

Answer

Answer: (b) Realisation Account

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Question 3.
At the dime of firm’s dissolution, Balance of General Reserve shown in the Balance Sheet is credited to :
(a) Realisation Account
(b) Creditors’ Account
(c) Partners’ Capital Accounts
(d) Profit & Loss Account

Answer

Answer: (c) Partners’ Capital Accounts

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Question 4.
On dissolution, goodwill account is transferred to :
(a) In the Capital Accounts of Partners
(b) In the Credit of Cash Accounts
(c) In the Debit of Realisation Account
(d) In the Credit of Realisation Account

Answer

Answer: (c) In the Debit of Realisation Account

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Question 5.
At the time of dissolution of partnership firm, fictitions assets are transferred to :
(a) Capital Accounts of Partners
(b) Realisation Account
(c) Cash Account
(d) Partners’ Loan Account

Answer

Answer: (a) Capital Accounts of Partners

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Question 6.
On dissolution of a firm, a partner paid 1,500 Rs. for firm’s realisation expenses. Which account will be debited ?
(a) Cash Account
(b) Realisation Account
(c) Capital Account of the Partner
(d) Profit & Loss A/c

Answer

Answer: (b) Realisation Account

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Question 7.
On taking responsibility of payment of realisation expenses by a partner, the account credited will be :
(a) Realisastion Account
(b) Cash Account
(c) Capital Account of the Partner
(d) None of the above

Answer

Answer: (c) Capital Account of the Partner

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Question 8.
When realisation expenses are paid by the firm on behalf of a partner, such expenses are debited to :
(a) Realisation Account
(b) Partners’ Capital Account
(c) Partner’s Loan Account
(d) None of these

Answer

Answer: (b) Partners’ Capital Account

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Question 9.
Which of the following is transferred to Realisation Account ?
(a) Balance of Profit Account
(b) Balance of Profit & Loss Account
(c) Amount realised on sale of assets
(d) Reserves

Answer

Answer: (c) Amount realised on sale of assets

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Question 10.
On disolution of firm, loss calculated in realisation account is debited/credited to which account ?
(a) Cash Account
(b) Partners’ Capital Accounts
(c) Realisation Account
(d) None of these

Answer

Answer: (b) Partners’ Capital Accounts

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Question 11.
Which of the following is not transferred to Realisatsion Account ?
(a) Balance of Cash Account
(b) Balance of Reserves
(c) Balance of Profit & Loss Account
(d) All of the above

Answer

Answer: (d) All of the above

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Question 12.
On taking responsibility of payment of a liability of ₹ 20,000 by a partner, the account credited will be :
(a) Realisation Account
(b) Cash Account
(c) Capital Account of the Partner
(d) Liability Account

Answer

Answer: (c) Capital Account of the Partner

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Question 13.
Cash balance shown in the Balance Sheet is shown on dissolution of firm in :
(a) Realisation Account
(b) Cash Account
(c) Capital Account
(d) None of the Account

Answer

Answer: (b) Cash Account

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Question 14.
There was an Unrecorded asset of ₹ 12,000 which was taken over by a partner at ₹ 10,500. Partner’s Capital Account will be debited by…….
(a) ₹ 12,000
(b) ₹ 10,500
(c) ₹ 1,500
(d) ₹ 32,500

Answer

Answer: (b) ₹ 10,500

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Question 15.
On dissolution of a firm, Bank overdraft is transferred to:
(a) Cash Account
(b) Bank Account
(c) Realisation Account
(d) Partners’ Capital Account

Answer

Answer: (c) Realisation Account

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Question 16.
On dissolution of a firm, Partner’s Loan Account is transferred to:
(a) Realisation Account
(b) Partner’s Capital Account
(c) Partner’s Current Account
(d) None of these

Answer

Answer: (d) None of these

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Question 17.
The accumulated profits and reserves are transferred to:
(a) Realisation Accounts
(b) Partners’ Capital Accounts
(c) Bank Account
(d) None of these

Answer

Answer: (b) Partners’ Capital Accounts

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Question 18.
On dissolution, Goodwill Account is transferred to :
(a) In the Capital Accounts of Partners
(b) On the Credit side of Cash Account
(c) On the Debit side of Realisation Account
(d) On the Credit side of Realisation Account

Answer

Answer: (c) On the Debit side of Realisation Account

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Question 19.
On dissolution, when a partner takes over an asset……….is debited :
(a) Realisation Account
(b) Partner’s Capital Account
(c) Cash Account
(d) Asset Account

Answer

Answer: (b) Partner’s Capital Account

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Question 20.
After transferring liabilities like creditors and bills payable in the Realisation Account in the absence of any informations regarding their payment, such liabilities are treated as :
(a) Never paid
(b) Fully paid
(c) Partly paid
(d) None of these

Answer

Answer: (b) Fully paid

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Question 21.
Unrecorded liabilities when paid are shown in :
(a) Debit side of Realisation Account
(b) Debit side of Bank Account
(c) Credit side of Realisation Account
(d) Credit side of Bank Account

Answer

Answer: (a) Debit side of Realisation Account

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Question 22.
Payment of credit balance of Partners’ Capital Accounts at the time of dissolution of a firm is made to:
(a) Partners
(b) Firm
(c) Wife
(d) None of these

Answer

Answer: (a) Partners

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Question 23.
On dissolution of a firm Partner’s Loan A/c is transferred to:
(a) Realisation A/c
(b) Partners’ Capital A/cs
(c) Suspense A/c
(d) None of these

Answer

Answer: (d) None of these

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Question 24.
At the time of dissolution of firm book value of assets is recorded in which side of the Realisation Account ?
(a) Debit Side
(b) Credit Side
(c) All of the above
(d) Liabilities Side

Answer

Answer: (a) Debit Side

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Question 25.
Realisation expenses are recorded in which side of Realisation A/c:
(a) Liabilities
(b) Assets
(c) Credit
(d) Debit

Answer

Answer: (c) Credit

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Question 26.
Realisation Account is a :
(a) Personal A/c
(b) Nominal A/c
(c) Read A/c
(d) None of these

Answer

Answer: (b) Nominal A/c

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Question 27.
On dissolution of the firm, Partners’ Capital Accounts are closed through :
(a) Realisation Account
(b) Drawings Account .
(c) Bank Account
(d) Loan Account

Answer

Answer: (c) Bank Account

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Question 28.
Unrecorded assets when taken over by a partner are shown in:
(a) Debit side of Realisation A/c
(b) Debit side of Bank A/c
(c) Credit side of Realisation A/c
(d) Credit side of Bank A/c

Answer

Answer: (c) Credit side of Realisation A/c

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Question 29.
Expenses on dissolution of firm is called :
(a) Realisation Expenses
(b) Legal Expenses
(c) Loss Expenses
(d) None of these

Answer

Answer: (a) Realisation Expenses

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Question 30.
Sundry creditors amounted to ₹ 8,000. They were paid at a discount of 5 %. Realisation A/c will be debited by :
(a) ₹ 8,000
(b) ₹ 7,600
(c) ₹ 400
(d) ₹ 8,400

Answer

Answer: (b) ₹ 7,600

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Question 31.
Amount realised from sale of assets is recorded in :
(a) Debit side of Realisation Account
(b) Credit side of Realisation Account
(c) Liabilities side of Balance Sheet
(d) Assets side of Balance Sheet

Answer

Answer: (b) Credit side of Realisation Account

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Question 32.
A firm can be voluntarily dissolved by the partners :
(a) On Majority basis
(b) On 3/4 Member’s decision
(c) On 1/2 Member’s decision
(d) None of these

Answer

Answer: (d) None of these

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Question 33.
On dissolution of a firm, amount realised from an unrecorded asset is credited to:
(a) partners’ Capital Accounts
(b) Cash Account
(c) Realisation Account
(d) Revaluation Account

Answer

Answer: (c) Realisation Account

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Question 34.
Profit/loss on Realisation Account is distributed among partners:
(a) In Profit-sharing Ratio
(b) In Capital Ratio
(c) Equally
(d) None of these

Answer

Answer: (a) In Profit-sharing Ratio

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Question 35.
Which of the following is correct profit or loss in case the amount received from the sale of assets is ₹ 50,000, total assets is ₹ 60,000, total liabilities ₹ 20,000 and realisation expenses ₹ 2,000 ?
(a) ₹ 12,000 Loss
(b) ₹ 32,000 Profit
(c) ₹ 30,000 Loss
(d) ₹ 12,000 Profit

Answer

Answer: (a) ₹ 12,000 Loss

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Question 36.
What will be the total assets (except cash) of the firm from the following: if Creditor ₹ 15,000, Partner’s loan ₹ 10,000, Partners’ capital ₹ 40,000. Cash in hand ₹ 5,000
(a) ₹ 60,000
(b) ₹ 65,000
(c) ₹ 70,000
(d) ₹ 55,000

Answer

Answer: (b) ₹ 65,000

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Question 37.
If the total assets are ₹ 3,25,000 and the total outside liabilities ₹ 45,000 then the amount of all partner’s capital will be:
(a) ₹ 3,70,000
(b) ₹ 2,80,000
(c) ₹ 3,00,000
(d) None of these

Answer

Answer: (b) ₹ 2,80,000

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Question 38.
Insolvency of a partner will come under what type of dissolution of a firm ?
(a) Dissolutiuon by Court
(b) Compulsory Dissolution
(c) On happening of certain contingencies
(d) None of these

Answer

Answer: (c) On happening of certain contingencies

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Question 39.
On firm’s dissolution, which one of the following account should be prepared at the last ?
(a) Realisation Account
(b) Partner’s Capital Accounts
(c) Cash/Bank Account
(d) Partner’s Loan Account

Answer

Answer: (c) Cash/Bank Account

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Question 40.
On dissolution of a firm, realisation account is debited with:
(a) All assets to be realised
(b) All outside liabilities of the firm
(c) Cash received on sale of assets
(d) Any assets taken over by one of the partners

Answer

Answer: (a) All assets to be realised

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Question 41.
On dissolution of a firm, out of the proceeds received from the sale of assets will be paid first of all:
(a) Partner’s Capitals
(b) Partner’s Loan to Firm
(c) Partner’s additional capital
(d) Outside Creditors

Answer

Answer: (d) Outside Creditors

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