1) Incomplete records are generally maintained by a) A company b) Government c) Small sized sole trader business d) Multinational enterprises 2) Statement of affairs is a a) Statement of income and expenditure b) Statement of assets and liabilities c) Summary of cash transactions d) Summary of credit transactions 3) Opening statement of affairs is usually prepared to find out the a) Capital in the beginning of the year b) Capital at the end of the year c) Profit made during the year d) Loss occurred during the year 4) The excess of assets over liabilities is a) Loss b) Cash c) Capital d) Profit 5) Which of the following items relating to bills payable is transferred to total creditors account? a) Closing balance of bills payable b) Bills payable accepted during the year c) Opening balance of bills payable d) Cash paid for bills payable 6) The amount of credit sales can be computed from a) Total debtors account b) Total creditors account c) Bills receivable account d) Bills payable account 7) Which one of the following statements is not true in relation to incomplete records? a) Tax authorities do not accept b) It is an unscientific method of recording transactions c) Records are maintained only for cash and personal accounts d) It is suitable for all types of organisations 8) What is the amount of capital of the proprietor, if his assets are ` 85,000 and liabilities are Rs 21,000? a) Rs 85000 b) Rs 106000 c) Rs 21000 d) 64000 9) When capital in the beginning is Rs 10,000, drawings during the year isRs 6,000, profit made during the year is Rs 2,000 and the additional capital introduced is Rs 3,000, find out the amount of capital at the end. a) Rs 9000 b) Rs 11000 c) Rs 21000 d) Rs 3000 10) Opening balance of debtors: Rs 30,000, cash received: Rs 1,00,000, credit sales: Rs 90,000; closing balance of debtors is a) Rs 30000 b) Rs 130000 c) Rs 40000  d) 20000 11) Receipts and payments account is a a) Nominal A/c b) Real A/c c) Personal A/c d) Representative personal account 12) Receipts and payments account records receipts and payments of a) Revenue nature only b) Capital nature only c) Both revenue and capital nature d) None of the above 13) Balance of receipts and payments account indicates the a) Cash and bank balance as on the date b) Loss incurred during the period c) Excess of income over expenditure of the period d) Total cash payments during the period 14) Income and expenditure account is a a) Nominal A/c b) Real A/c c) Personal A/c d) Representative personal account 15) Income and Expenditure Account is prepared to find out a) Profit or loss b) Cash and bank balance c) Surplus or deficit d) Financial position 16) Which of the following should not be recorded in the income and expenditure account? a) Sale of old news papers b) Loss on sale of asset c) Honorarium paid to the secretary d) Sale proceeds of furniture 17) Subscription due but not received for the current year is a) An asset b) A liability c) An expense d) An item to be ignored 18) Legacy is a a) Revenue expenditure b) Capital expenditure c) Revenue receipt d) Capital receipt 19) Donations received for a specific purpose is a) Revenue receipt b) Capital receipt c) Revenue expenditure d) Capital expenditure 20) There are 500 members in a club each paying Rs 100 as annual subscription. Subscription due but not received for the current year is Rs 200; Subscription received in advance is Rs 300. Find out the amount of subscription to be shown in the income and expenditure account. a) Rs 50000 b) Rs 50200 c) Rs 49900 d) Rs 49800 21) In the absence of a partnership deed, profits of the firm will be shared by the partners in a) Equal ratio b) Capital ratio c) Both Equal and Capital ratio d) None of these 22) In the absence of an agreement among the partners, interest on capital is a) Not allowed b) Allowed at bank rate c) Allowed @ 5% per annum d) Allowed @ 6% per annum 23) As per the Indian Partnership Act, 1932, the rate of interest allowed on loans advanced by partners is a) 8% per annum b) 12% per annum c) 5% per annum d) 6% per annum 24) Which of the following is shown in Profit and loss appropriation account? a) Office expenses b) Salary of staff c) Partners’ salary d) Interest on bank loan 25) 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 drawings c) Interest on capital d) Share of profit 26) When a partner withdraws regularly a fixed sum of money at the middle of every month, period for which interest is to be calculated on the drawings on an average is a) 5.5 moths b) 12 months c) 6 months d) 6.5 months 27) Which of the following is the incorrect pair? a) Share of profit – Credited to capital account b) Interest on drawings – Debited to capital account c) Interest on capital – Credited to capital account d) Interest on loan – Debited to capital account 28) In the absence of an agreement, partners are entitled to a) Salary b) Commission c) Interest on loan d) Interest on capital 29) Pick the odd one out a) Interest on loan from partners is allowed at 6% per annum. b) Partners share profits and losses equally c) Interest on partners’ capital is allowed at 7% per annum d) No salary or remuneration is allowed to partners 30) Profit after interest on drawings, interest on capital and remuneration is Rs 10,500. Geetha, a partner, is entitled to receive commission @ 5% on profits after charging such commission. Find out commission. a) Rs 50 b) Rs 150 c) Rs 550 d) Rs 500 31) Which of the following statements is true? a) Goodwill is an intangible asset b) Goodwill is a current asset c) Goodwill is a fictitious asset d) Goodwill cannot be acquired 32) Super profit is the difference between a) Capital employed and average profit b) Assets and liabilities c) Average profit and normal profit d) Current year’s profit and average profit 33) The average rate of return of similar concerns is considered as a) Average profit b) Normal rate of return c) Expected rate of return d) None of these 34) Which of the following is true? a) Super profit = Average profit × Years of purchase b) Super profit = Total profit / number of years c) Super profit = Weighted profit / number of years d) Super profit = Average profit – Normal profit 35) Identify the incorrect pair a) Goodwill under Weighted average - Weighted average profit × Number of years of profit method purchase b) Goodwill under Average profit method - Average profit × Number of years of purchase c) Goodwill under Super profit method - Super profit × Number of years of purchase d) Goodwill under Annuity method - Average profit × Present value annuity factor 36) When the average profit is Rs 25,000 and the normal profit is Rs 15,000, super profit is a) Rs 25,000 b) Rs 5,000 c) Rs 10,000 d) Rs 15,000 37) Book profit of 2017 is Rs 35,000; non-recurring income included in the profit is Rs 1,000 and abnormal loss charged in the year 2017 was Rs 2,000, then the adjusted profit is a) Rs 36000 b) Rs 35000 c) Rs 38000 d) Rs 34000 38) The total capitalised value of a business is Rs 1,00,000; assets are Rs 1,50,000 and liabilities are Rs 80,000. The value of goodwill as per the capitalisation method will be a) Rs 40,000 b) Rs 70,000 c) Rs 1,00,000 d) Rs 30,000 39) Revaluation A/c is a a) Real A/c b) Nominal A/c c) Personal A/c d) Impersonal A/c 40) On revaluation, the increase in the value of assets leads to a) Gain b) Loss c) Expense d) None of these 41) The profit or loss on revaluation of assets and liabilities is transferred to the capital account of  a) The old partners b) All the partners c) The new partner d) The Sacrificing partners 42) If the old profit sharing ratio is more than the new profit sharing ratio of a partner, the difference is called a) Capital ratio b) Sacrificing ratio c) Gaining ratio d) None of these 43) At the time of admission, the goodwill brought by the new partner may be credited to the capital accounts of a) all the partners b) the old partners c) the new partner d) the sacrificing partners 44) Which of the following statements is not true in relation to admission of a partner a) The existing agreement does not come to an end b) Generally mutual rights of the partners change c) The profits and losses of the previous years are distributed to the old partners d) The firm is reconstituted under a new agreement 45) Match : (i) Sacrificing ratio 1. Investment fluctuation fund  (ii) Old profit sharing ratio 2. Accumulated profit  (iii) Revaluation Account 3. Goodwill (iv) Capital Account 4. Unrecorded liability a) 1 2 3 4 b) 3 2 4 1 c) 3 1 2 4 d) 4 3 2 1 46) Select the odd one out a) Revaluation profit b) Accumulated loss c) Goodwill brought by new partner d) Investment fluctuation fund 47) James and Kamal are sharing profits and losses in the ratio of 5:3. They admit Sunil as a partner giving him 1/5 share of profits. Find out the sacrificing ratio. a) 1:3 b) 3:1 c) 5:3 d) 3:5 48) Balaji and Kamalesh are partners sharing profits and losses in the ratio of 2:1. They admit Yogesh into partnership. The new profit sharing ratio between Balaji, Kamalesh and Yogesh is agreed to 3:1:1. Find the sacrificing ratio between Balaji and Kamalesh. a) 1 : 3 b) 3 : 1 c) 2 : 1 d) 1 : 2 49) A partner retires from the partnership firm on 30th June. He is liable for all the acts of the firm up to the a) Date of his retirement b) Date of his final settlement c) End of the current accounting period d) End of the previous accounting period 50) On retirement of a partner from a partnership firm, accumulated profits and losses are distributed to the partners in the a) New profit sharing ratio b) Old profit sharing ratio c) Gaining ratio d) Sacrificing ratio 51) On retirement of a partner, general reserve is transferred to the a) Capital account of all the partners b) Revaluation account c) Capital account of the continuing partners d) Memorandum revaluation account 52) On revaluation, the increase in liabilities leads to a) Gain b) Loss c) Profit d) None of these 53) At the time of retirement of a partner, determination of gaining ratio is required a) None of these b) To transfer revaluation profit or loss c) To distribute accumulated profits and losses d) To adjust goodwill 54) 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) Other partners’ capital A/c d) Retiring partner’s loan A/c 55) ‘A’ was a partner in a partnership firm. He died on 31st March 2019. The final amount due to him is Rs 25,000 which is not paid immediately. It will be transferred to a) A’s capital account b) A’s Executor loan account c) A’s current account d) A’s Executor account 56) A, B and C are partners sharing profits in the ratio of 2:2:1. On retirement of B, goodwill of the firm was valued as Rs 30,000. Find the contribution of A and C to compensate B: a) Rs 20,000 and Rs 10,000 b) Rs 15,000 and Rs 15,000 c) Rs 8,000 and Rs 4,000 d) Rs 10,000 and Rs 20,000 57) A, B and C are partners sharing profits in the ratio of 4:2:3. C retires. The new profit sharing ratio between A and B will be a) 4 : 3 b) 3 : 4 c) 2 : 1 d) 1 : 2 58) X, Y and Z were partners sharing profits and losses equally. X died on 1st April 2019. Find out the share of X in the profit of 2019 based on the profit of 2018 which showed Rs 36,000. a) Rs 1000 b) Rs 3000 c) Rs 12000 d) Rs 36000

+2 Acc Qly EM Prepared by M.MuthuSelvam Cell No : 9842104826

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