Reassessment of Liabilities (Retirement)

Q.

Is Legacy shown in the income and expenditure account?

Q.

The revaluation profit/ loss is transferred to the capital accounts of ______.

1. Ongoing partners

2. All partners

3. Outgoing partner

4. Incoming partners

Q.

In case the revaluation account is prepared, the assets & liabilities appear in the books of the reconstituted firm at their :

1. Realizable Value

2. Revalued figure

3. Market Value

4. Old Book Values

Q.

The value of the machinery in the balance sheet is Rs. 50, 000 and after revaluation it came to Rs. 35, 000. So what is the journal entry we pass -

1. Revaluation A/c Dr. 15, 000
   To Machinery A/c 15, 000

2. Machinery A/c Dr. 15, 000
   To Revaluation A/c 15, 000

3. Machinery A/c Dr. 35, 000
   To Revaluation A/c 35, 000

4. Revaluation A/c Dr. 35, 000
   To Machinery A/c 35, 000

Q.

Are comparative financial statements required by GAAP?

Q. Why is it necessary to create a provision for doubtful debts at the time of preparation of final accounts?

Q.

The revaluation profit/ loss is transferred to the capital accounts of all partners in ______.

1. Old Ratio

2. Gaining Ratio

3. Sacrificing ratio

4. None of these

Q. Profit on revaluation of assets and liabilities at the time of retirement of a partner will be credited to __________________.

1. Remaining partners in the profit sharing ratio
2. All the partners in their old ratio
3. Remaining partners in their gaining ratio
4. Capital Ratio

Q.

How will you deal with a change in the profit sharing ratio among existing partners?

Take imaginary figures to illustrate your answer?

Q. Give a word / term / phrase which can substitute each of the following statements :

Excess of credit side over debit side of revaluation account.

Q.

The revaluation profit is ____ to the capital accounts of all partners.

1. either A or B

2. None of the above

3. credited

4. debited

Q. Provision for bad debts are created by ____________ profit and loss account.

1. Adding
2. Deducting
3. Debiting
4. Crediting

Q. Which of the following is not contingent liability?

1. Uncalled liability on partly paid shares
2. Claims against the company not acknowledged as debts
3. Debts included on debtors which are doubtful in nature
4. Estimated amount of contracts remaining to be executed on capital amount and not provided for

Q. Cost of stock as per books is Rs.2, 38, 000
Goods purchases for Rs.10, 000 received but omitted to be recorded
Goods costing Rs.20, 000 were sold & delivered but omitted to be recorded
Goods costing Rs.5, 000 were returned by customers but omitted to be recorded.
Goods costing Rs.3, 000 were returned to suppliers but omitted to be recorded.
The value of physical inventory is ___________.

1. Rs.2, 26, 000
2. Rs.2, 46, 000
3. Rs.2, 30, 000
4. None of these

Q. Which of the following statement is wrong:

1. Consignor is the owner of the consignment stock
2. Del-credere commission is allowed by consignor to protect himself from bad debt.
3. Proportionate consignor's expenses is added up with consignment stock.
4. All proportionate consignee's expenses will be added up for valuation of consignment stock.

Q. Short answer type question:
State the ratio in which the partners share gain or loss from revaluation. of assets and liabilities.

Q. Write the word / term / phrase, which can substitute each of the following statements.

Debit balance in realisation account.

Q. On March 31, 2010, the cash showed a balance of Rs.3, 700 as cash at bank, but the bank pass book made up to same date showed that cheques for Rs. 700, Rs. 300, and Rs. 180 respectively had not presented for payment.Also, cheque amounting to Rs. 1, 200 deposited into the account had not been credited.Prepare a bank reconciliation statement.

Q. State the ratio in which the partners share the gain or loss on revaluation of assets and liabilities.

Q.

A merchanthad Rs 78, 592 with her. She placed an order for purchasing 40 radiosets at Rs 1200 each. How much money will remain with her after thepurchase?

Q. A continuing guarantee may be revoked by the surety at any time, as to _______, by notice to the creditor.

1. Past transactions
2. Future transactions
3. Existing transactions
4. None of the above

Q. Sale of inventory for cash will cause the current ratio to __________.

1. remain unchanged
2. increase
3. decrease
4. none of these

Q.

Revaluation Account is debited :

1. To transfer loss on revaluation

2. On derease in the amount of creditors

3. On increase in the value of land & building

4. On increase in provision for doubtful debts

Q. Which of these statements is not true?

1. Accumulated profit and loss, General reserve are transferred to old partners capital account
2. If assets and liabilities are to be shown in the balance sheet at old value, Memorandum Revaluation account is opened
3. Profit of revaluation is transferred to the capital account of all partners in equal ratio
4. Revaluation account is a nominal account

Q. Loss on sale of old furniture and fitting is debited to__________.

1. Depreciation A/c
2. Trading A/c
3. Profit and loss a/c
4. Furniture and fitting A/c

Q. Profit or loss on revaluation is shared among the partners in ________.

1. new profit sharing
2. old profit sharing
3. equal
4. capital

Q. Rs. 510 paid on carriage of office equipment was debited to sundry expenses a/c. On rectification account will be credited_________.

1. suspense
2. sales
3. none of these
4. sundry expenses

Q. Consignee account is of the nature of ____________.

1. Real account
2. Personal account
3. Nominal account
4. Trading account

Q. On dissolution if workmen compensation liability exceeds reserve then what will be the journal entry?

Q. From the following find out the correct equation:
I. A represents opening stock
II. B represents purchases
III. C represents closing stock
IV. D represents cost of goods sold.

1. A$-$C$=$D$-$B
2. A$+$B$=$D$-$C
3. D$-$A$=$B$+$C
4. None of the above