Dissolution of partnership MCQs

AccountingQnA.com has 9 Dissolution of partnership MCQs

If a liability is settled at higher value than shown on the balance sheet and a partner takes the responsibility to pay that:

  • A. It causes a loss of realization
  • B. It causes gain on realization
  • C. It is loss for the partner
  • D. None
  • Correct Answer: Option A

When all the partners are insolvent accounts payable will be:

  • A. Paid fully
  • B. Paid rateably
  • C. Taken over by partner
  • D. None
  • Correct Answer: Option B

Loss on realization is:

  • A. Debited to partners capital account
  • B. Credited to partners capital account
  • C. Debited to realization account
  • D. None
  • Correct Answer: Option A

Loss on realization is distributed among partners:

  • A. According to income sharing ratio
  • B. According to capital ratio
  • C. As decided among them
  • D. None
  • Correct Answer: Option A

If a partner takes over an asset of the firm, his capital account:

  • A. will be debited with the amount as agreed
  • B. will be credited with the market value of the asset
  • C. will be debited with book value of asset
  • D. None
  • Correct Answer: Option A

At the time of dissolution non-cash assets are credited with:

  • A. Market value
  • B. Book value
  • C. As the agreed amount among partners
  • D. None
  • Correct Answer: Option B

At the time of dissolution:

  • A. all the assets are transferred to realization account
  • B. Only current assets are transfered to realization account
  • C. Non-cash assets are tranferred to realization account
  • D. None
  • Correct Answer: Option C

If all the partners, but one are insolvent it is:

  • A. Dissolution of an agreement
  • B. Dissolution of a firm
  • C. May or may not cause dissolution
  • D. None
  • Correct Answer: Option B

Retirement and death of a partner:

  • A. is dissolution of partnership agreement
  • B. is dissoluton of a firm
  • C. may or may not be a dissolution of partnership agreement
  • D. None
  • Correct Answer: Option A