Fundamental of Partnership
1. Interest on loan taken by a partner is recorded on___________ of Profit and Loss Account.
Answer: Credit side
Explanation : Interest on loan taken by a partner is the amount of interest that is received by the firm on the amount of loan taken by a partner. It is shown on the credit side of the Profit and Loss Account.
2. Interest on Capital are under the Fixed Capital Account method is credited to ___________.
Answer: Partners Current A/c
Explanation : Under Fixed Capital Method Adjustments relating to Interest on Capital, Interest on Drawings, Salary, Commission, etc. are shown in Current A/c.
3. In the absence of partnership deed rate of interest on partner loan will be_________.
Answer: 6% p. a.
Explanation : According to Partnership Act 1932, In the absence of partnership deed rate of interest on partner loan will be 6% p.a..
4. If drawings of equal amount are made in the beginning of every month for 9 month ending 31st March, then interest on drawing will be calculated for an average period for _________Months.
Answer: 5
Explanation : "Formula: Time left after First Drawings + Time left after Last Drawings/2
9+1/2=5 Months
5. The maximum numbers of partners in case of limited liability partnership is __________.
Answer: Unlimited
Explanation : The minimum number of partners to incorporate an LLP is 2. There is no upper limit on the maximum number of partners of LLP.
6. In case of guarantee of minimum profit to a partner deficiency of guaranteed partner is shared by remaining partner in ____________.
Answer: Agreed Ratio
Explanation : In case of guarantee of minimum profit to a partner deficiency of guaranteed partner is shared by remaining partner in Agreed Ratio.
7. If partner’s capital is fixed interest on drawing will be recorded on __________.
Answer: Partner’s Current A/c
Explanation : Under Fixed Capital Method Adjustments relating to Interest on Capital, Interest on Drawings, Salary, Commission, etc. are shown in Current A/c.
Question: Profit and Losses are to be shared in __________ irrespective of their capital contribution.
Answer: Agreed Ratio
Explanation : Profit and Losses are to be shared in Agreed Ratio irrespective of their capital contribution.
Question: Interest at the rate of_______ is to be allowed on a partner’s loan to the firm.
Answer: 6% p. a.
Explanation : According to Partnership Act 1932, In the absence of partnership deed rate of interest on partner loan will be 6% p.a..
Question: In the absence of the date of withdrawal, interest should be charged for __________ month on the whole amount.
Answer: Six
Explanation : In case if there is no information about date of withdrawal, then the rate of Interest of Drawings will be 6 Months.
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