Class 12 Accountancy MCQs Dissolution of Partnership Firm
These MCQs are based on examination questions for practice to prepare for final exams.
Answerrs are given at the end.
- New ratio is not to be calculated on:
a) Admission of a partner
b) retirement of a partner
c) death of a partner
d) dissolution of partnership firm
2. On dissolution of a firm fictitious assets are transferred to:
a) credit side of partners’ capital account
b) debit side of realisation account
c) debit side of partners’ capital account
d) credit side of realisation account
3. In case of dissolution Rohit one of the partners was paid only ₹6000 for his loan to the firm which amounted to ₹6500. ₹ 500 will be recorded in which account and on which side:
a) Realisation account debit side
b) Realisation account credit side
c) loan account debit side
d) A's capital account credit side
4. Section 41 of partnership act 1932 deals with dissolution of a firm:
a) by mutual agreement
b) compulsory dissolution
c) by notice
d) by order of court
5. Settlement of accounts in case of dissolution of partnership is dealt with …… section of partnership act 1932:
a) Section 45
b) section 46
c) section 47
d) section 48
6. At the time of dissolution total assets are worth ₹3,00,000 and external liabilities are worth ₹1,40,000. If assets realised 120% and realisation expenses paid were ₹6,000, then profit/loss on realisation will be:
a) Profit ₹60,000
b) Loss ₹60,000
c) Loss ₹56,000
d) Profit ₹54,000
7. On the basis of the following data, how much final payment will be made to a partner on firm’s dissolution? Credit balance of Capital Account of the partner was ₹50,000. Share of loss on realisation amounted to ₹10,000. Firm’s liability taken over by him was for ₹8,000.
a) ₹32,000
b) ₹48,000
c) ₹40,000
d) ₹52,000
8. On the day of dissolution of the firm ‘Ankit Brothers’ had partner’s capital amounting to ₹1,50,000 external liabilities ₹35,000, Cash balance ₹8,000 and P&LA/c(Dr.) ₹7,000. If Realisation expense and loss on Realisation amounted to₹5,000 and ₹25,000 respectively, the sale of assets realized:
a) ₹1,64,000
b) ₹1,45,000
c) ₹1,57,000
d) ₹1,50,000
9. In which of the following cases is the business of a firm not dissolved compulsorily?
a) When all but one partner becomes insolvent.
b) When the business of the firm becomes illegal.
c) When there is a change in profit sharing ratio between existing partners.
d) When a partner who is a citizen of a country becomes an alien enemy because of the declaration of war with his country and India.
10. Ruhi, Juhi and Sheetal were partners sharing profits equally. At the time of dissolution of the partnership firm, Ruhi’s loan to the firm will be:
a) Credited to Ruhi’s Capital Account.
b) Debited to Realisation Account.
c) Credited to Realisation Account.
d) Credited to Bank Account.
Class 12 Accountancy MCQs Dissolution of Partnership Firm
11. State the order of payment of the following, in case of dissolution of partnership firm.
A-to each partner proportionately what is due to him on account of capital;
B-for the debts of the firm to the third parties;
C-to each partner proportionately what is due to him/her from the firm for advances as distinguished from capital (i.e. partner’ loan).
a) A,B,C
b) A,C,B
c) C,A,B
d) B,C,A
12. Book value of creditors given in the Balance Sheet before dissolution was ₹2,00,000. Half of the creditors accepted furniture of ₹1,20,000 at an agreed value of 10% less than the book value and cash of ₹8,000 in settlement of their claim. Remaining creditors were paid at a discount of 5%. Bank Account will be credited in Realisation Account for payment to creditors by:
a) ₹95,000
b) ₹1,03,000
c) ₹1,08,000
d) ₹1,00,000
13. At the time of dissolution of a firm, creditors are ₹3,20,000, firm's capital is ₹4,80,000, Bank Balance is ₹50,000. Other assets realised ₹6,00,000. Gain/Loss in the Realisation Account will be:
a) ₹1,50,000 (Gain)
b) ₹1,60,000 (Gain)
c) ₹2,00,000 (Gain)
d) ₹1,50,000 (Loss)
14. On the day of dissolution of the firm ‘Neel Brothers’ had partner’s capital amounting to ₹1,50,000, external liabilities ₹35,000, Cash balance ₹8,000 and P&LA/c(Dr.) ₹7,000. If Realisation expense and loss on Realisation amounted to₹5,000 and ₹25,000 respectively, the amount realised by sale of assets is:
a) ₹1,64,000
b) ₹1,45,000
c) ₹1,57,000
d) ₹1,50,000
15. Arun, Varun and Chetan are partners. The firm had given a loan of ₹20,000 to Varun. They decided to dissolve the firm. In the event of dissolution the loan will be settled by transferring it to the:
a) debit side of realisation account
b) transferring it to the credit side of realisation account
c) transfer it to the debit side of Varun's capital account
d) Varun paying Arun and Chetan privately.
16. In case of dissolution, total creditors of the firm were ₹30,000; creditors worth ₹10000 were given a piece of furniture costing ₹7000 in full and final settlement. Remaining creditors allowed a discount of 10%. What will be the amount with which cash will be credited in the realisation account for payment to creditors:
a) ₹28,000
b) ₹27,000
c) ₹18,000
d) ₹25,000
17. On dissolution of a firm, its Balance Sheet revealed total creditors ₹50,000; Total Capital ₹48,000; Cash Balance ₹5,000. Its assets were realised at 10% less. Loss on realisation will be:
a) ₹6,000
b) ₹11,760
c) ₹11,400
d) ₹9,300
18. X and Y are partners in a partnership firm sharing profit and losses in the ratio of 3:2. On 31st March 2024 the firm was dissolved. On the date, Furniture of book value of ₹80,000 was sold for ₹74,000 by auction and auctioneer's Commission was ₹2,000, then bank account will be debited with:
a) ₹66,000
b) ₹68,000
c) ₹72,000
d) ₹70,000
19. Mitesh is a Partner, who has given a loan of ₹1,09,000 to the firm. At the time of dissolution of the firm he accepted ₹1,00,000 in full settlement of his loan. What will be the journal entry?
a) Mitesh's Loan A/c Dr. 1,09,000
To Bank A/c 1,00,000
To Realisation A/c 9,000
b) Mitesh's Loan A/c Dr. 1,00,000
To Bank A/c 1,00,000
c) Mitesh's Loan A/c Dr. 1,09,000
To Bank A/c 9,000
To Realisation A/c 1,00,000
d) Mitesh's Loan A/c Dr. 1,09,000
To Bank A/c 1,00,000
To Mitesh's Capital A/c 9,000
20. At the time of dissolution of partnership firm, if the realizable value of intangible asset is not given, the realised value will be taken as:
a) market value
b) book value
c) nil
d) none of these
More questions will be added from time to time...
Class 12 Accountancy MCQs Dissolution of Partnership Firm - Answers
- d) dissolution of partnership firm
- c) debit side of partners’ capital account
- b) Realisation account credit side
- b) compulsory dissolution
- d) section 48
- d) Profit ₹54,000
- b) ₹48,000
- d) ₹1,50,000
- c) When there is a change in profit sharing ratio between existing partners.
- d) Credited to Bank Account.
- d) B,C,A
- b) ₹1,03,000
- d) ₹1,50,000 (Loss)
- d) ₹1,50,000
- c) transfer it to the debit side of Varun's capital account
- c) ₹18,000
- d) ₹9,300
- c) ₹72,000
- a) Mitesh's Loan A/c Dr. 1,09,000To Bank A/c 1,00,000To Realisation A/c 9,000
- c) nil
Class 12 Accountancy MCQs Death of Partner