Accountancy Chapter 5 (Part 2) – Dissolution of partnership firm MCQ Question and Answers – MCQs for Practice

1. At the time of dissolution of partnership firm, the amount of ‘Bills Payable’ shown in the liability side of Balance Sheet is transferred to:

2. On dissolution of a firm, bank overdraft is transferred to

3. On dissolution, when a partner takes over an asset is debited

4. Reason for which a dissolution is undertaken by court

5. On dissolution of the firm, partner’s capital accounts are closed through

6. On expenses of realisation when actual expenses are paid by the partner on behalf of the firm. Which Account is Debited?

7. A firm is dissolved compulsorily in the following cases

8. On dissolution of a firm, a partner paid 1,500 Rs. for firm’s realisation expenses. Which account will be Credited?

9. On payment of liabilities which Account is Credited?

10. Sundry Creditors amounted to Rs. 10000. These were paid at a discount of 5%. Realisation account will be debited by

11. On dissolution of a firm, partner’s loan account is transferred to

12. If total assets are Rs. 2,00,000; total liabilities are Rs. 40,000; amount realised on sale of assets is Rs. 1,75,000 and realisation expenses are Rs. 3,000, the profit or loss on realisation will be:

13. On sale of assets Which account is debited?

14. The _________Account is prepared to record the transactions relating to sale and realisation of assets and settlement of creditors

15. At the time Dissolution, all the assets of the firm are transferred to the Realisation account At ______ Values

16. On settlement of capital accounts., Which account will be Credited?

17. The accumulated profits reserves are transferred to

18. ________ Means End of the existence of firm, and no business is transacted after It except the activities related to closing of the firm as the affairs of the firm are to be wound up by selling firm’s assets and paying its liabilities and discharging the claims of the partners.

19. When the firm has agreed to pay the partner a fixed amount for realisation work irrespective of the actual amount spent, such fixed amount is debited to _________Account and Credited to __________Account

20. On dissolution of a firm, out of the proceeds received from the sale of assets will be paid first of all