Partnership Accounting Basics Quiz
10 Questions
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Partnership Accounting Basics Quiz

Created by
@AdvancedRubellite

Questions and Answers

What are the essential features of a partnership?

Mutual agency and shared profits

What is the Indian Partnership Act 1932 relevant for?

Identifying provisions for accounting

What affects the distribution of profits among partners?

Guarantee for a minimum amount of profit

What happens when a partnership firm comes into existence?

<p>Two or more persons establish a business and share its profits</p> Signup and view all the answers

Why might the provisions of the Indian Partnership Act 1932 apply in a partnership?

<p>Lack of specific agreements between partners</p> Signup and view all the answers

What is the primary reason for people to adopt the partnership form of organisation?

<p>To acquire more capital and share business risks</p> Signup and view all the answers

In a partnership firm, what happens when there is no specific agreement between the partners regarding the distribution of profits?

<p>The provisions of the Indian Partnership Act 1932 apply</p> Signup and view all the answers

What is the impact of a guarantee for a minimum amount of profit on the distribution of profits among partners?

<p>It affects the distribution of profits among the partners</p> Signup and view all the answers

What is the purpose of preparing partners’ capital accounts under fixed and fluctuating capital methods?

<p>To track changes in partners' capital investments</p> Signup and view all the answers

What is the significance of making necessary adjustments to rectify past errors in partners' capital accounts?

<p>To ensure accurate representation of partners' capital interests</p> Signup and view all the answers

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