Classical

Financial and Management Accounting - Financial and Management Accounting Practice Questions

41:  
According to the decision in Garner vs. Murray, in the absence of any agreement to the contrary, the deficiency of the insolvent partner must be borne by other solvent partners in proportion to
A.

Profit and loss sharing ratio

B.

Capital ratio

C.

Their initial capital invested in the firm

D.
Capital which stood before dissolution of the firm.
 
 

Option: D

Explanation :


42:  
When goodwill is received in cash and retained in the business upon admission of a new partner the old partners' capital accounts are credited in the
A.

Old profit sharing ratio

B.

New profit sharing ratio

C.

Capital ratio

D.

Sacrificing ratio

 
 

Option: D

Explanation :


43:  
Receipts and payments account of non-trading concerns is a
A.

Nominal Account

B.

Real Account

C.

Personal Account

D.

All of the above

 
 

Option: B

Explanation :


44:  
Right shares can be issued at any time after the expiry of
A.

Two years from the formation of a company

B.
One year from the first allotment of shares in the company
C.

(A) or (B) whichever is earlier.

D.

(A) or (B) whichever is latter.

 
 

Option: C

Explanation :


45:  
Income and Expenditure Account is prepared on the basis of
A.

Cash system of accountancy

B.

Mercantile system of accountancy

C.

Credit system of accountancy

D.

Both (A) and (B)

 
 

Option: B

Explanation :




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