Chapter Exam

Chapter 3 ACCOUNTANCY : Introduction to Partnership Accounts — Online MCQ Test

Q: What is the minimum number of persons required to form a partnership firm under the Indian Partnership Act, 1932?

Answer: B. 2 — A partnership is defined as the relation between persons who have agreed to share the profits of a business; a minimum of two persons is required.

Q: The document which contains the terms and conditions of partnership is called:

Answer: B. Partnership Deed — A Partnership Deed is a written agreement among the partners that sets out the terms and conditions of their partnership.

Q: If a fixed amount is withdrawn by a partner on the first day of every month, interest on drawings is calculated for:

Answer: B. 6.5 months — When drawings are made on the first day of each month, the average period used for calculation is 6.5 months.

Q: Which of the following would require an adjustment in the P&L Appropriation account?

Answer: C. Interest on drawings — Rent paid to a partner, manager's commission, and bank loan interest are charges against profits, while interest on drawings is an appropriation.

ACCOUNTANCY · CLASS 12 INTER II YEAR · Andhra State Board

Practice Chapter 3 ACCOUNTANCY : Introduction to Partnership Accounts with a free chapter-wise online MCQ test for Andhra State Board CLASS 12 INTER II YEAR ACCOUNTANCY. This chapter covers: This chapter covers partnership deed fundamentals interest on capital interest on drawings profit and loss appropriation account and partner capital account methods.. AI-generated questions from basic to board-exam level, with instant results and explanations.

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Chapter 3 ACCOUNTANCY : Introduction to Partnership Accounts — Important Questions & Answers (FAQ)

Frequently asked questions from Andhra State Board CLASS 12 INTER II YEAR ACCOUNTANCY — Chapter 3 ACCOUNTANCY : Introduction to Partnership Accounts, with answers and explanations. These are sample questions; the exam has its own separate question set.

What is the minimum number of persons required to form a partnership firm under the Indian Partnership Act, 1932?

A. 1
B. 2 ✓
C. 5
D. 10

Answer: B. 2
A partnership is defined as the relation between persons who have agreed to share the profits of a business; a minimum of two persons is required.

The document which contains the terms and conditions of partnership is called:

A. Partnership Act
B. Partnership Deed ✓
C. Prospectus
D. Articles of Association

Answer: B. Partnership Deed
A Partnership Deed is a written agreement among the partners that sets out the terms and conditions of their partnership.

If a fixed amount is withdrawn by a partner on the first day of every month, interest on drawings is calculated for:

A. 6 months
B. 6.5 months ✓
C. 5.5 months
D. 12 months

Answer: B. 6.5 months
When drawings are made on the first day of each month, the average period used for calculation is 6.5 months.

Which of the following would require an adjustment in the P&L Appropriation account?

A. Rent paid to a partner
B. Manager's commission
C. Interest on drawings ✓
D. Interest on bank loan

Answer: C. Interest on drawings
Rent paid to a partner, manager's commission, and bank loan interest are charges against profits, while interest on drawings is an appropriation.

Why is the Profit and Loss Appropriation account considered an extension of the Profit and Loss account?

A. Because it starts with net profit from the P&L account ✓
B. Because it calculates gross profit
C. Because it is prepared before the P&L account
D. Because it includes external liabilities

Answer: A. Because it starts with net profit from the P&L account
The P&L Appropriation account begins with the net profit or loss figure transferred from the P&L account to show its further distribution.

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Chapter 4 ACCOUNTANCY : Admission of a Partner