1.
What is partnership?
2.
What is partnership deed?
3.
State the meaning of a Balance Sheet.
4.
When are partners’ current accounts opened?
5.
Write the meaning of bad debts?
6.
State the meaning of closing stock.
7.
How is closing stock valued?
8.
What is Trial Balance?
9.What
do you mean by Fluctuating Capital Method?
10. If the partnership deed is
silent, what is the profit sharing of the partners?
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1.
What is partnership?
Ans.
Partnership is a form of business organisation in which two or more persons
enter into an agreement, contribute certain capital, undertake certain lawful
business to earn profit and share the profits or losses in agreed proportion.
2.
What is partnership deed?
Ans. A partnership deed is a written agreement
duly stamped and signed document containing the terms and conditions of the
partnership.
3.
State the meaning of a Balance Sheet.
Ans. A balance
sheet is a statement showing the financial position of the business in the form
of its assets and liability on a particular date.
4.
When are partners’ current accounts opened?
Ans. When
partnership form adopts fixed capital method, it opens partners’ current accounts
to record dealing of partners with partnership firm.
5.
Write the meaning of bad debts?
Ans. The debt
or its part which cannot be recovered from a debtor is called bad debts.
6.
State the meaning of closing stock.
Ans. The unsold
goods remained in the business at the end of the accounting year is known as
closing stock.
7.
How is closing stock valued?
Ans. Closing
stock is valued at cost price or market price whichever is less.
8.
What is Trial Balance?
Ans. Trial
balance is a statement showing the list debit and credit balances of all the
ledger accounts on a particular date.
9.What
do you mean by Fluctuating Capital Method?
Ans.
Fluctuating capital method is one in which capital balances of the partners go
on changing every year due to entries for adjustments like drawings, interest
on capital and drawings, salaries, commission, allowances, etc. Recorded in
their capital accounts.
10. If the partnership deed is
silent, what is the profit sharing of the partners?
Ans. If the
partnership deed is silent, partners will share profits and losses in equal
ratio.
