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Select the most appropriate alternative from the following & rewrite the sentence:

Balbharati solutions for Book-keeping and Accountancy 12th Standard HSC Maharashtra State Board.

Chapter 1 - Introduction to Partnership and Partnership Final Accounts [Latest edition]

Select the most appropriate alternative from the following & rewrite the sentence:

When there is no partnership agreement between partners, the division of Profits takes place in ________ ratio.

  • 1. Equal
  • 2. capital ratio
  • 3. initial contribution
  • 4. experience and tenure of partner

To find out Net Profit or Net Loss of the business __________ account is prepared.

  • 1. Trading
  • 2. Capital
  • 3. Current
  • 4. Profit & Loss

A ____________ is an Intangible Asset.

  • 1. Goodwill
  • 2. Stock
  • 3. Cash
  • 4. Furniture

In the absence of an agreement, interest on loan advanced by the partner to the firm is allowed at the rate of _____________.

  • 1. 5%
  • 2. 6%
  • 3. 10%
  • 4. 9%

Liability of partners in a partnership business is ________.

  • 1. Limited
  • 2. Unlimited
  • 3. Limited and Unlimited
  • 4. None of the above

The Indian Partnership Act is in force since _______.

  • 1. 1932
  • 2. 1881
  • 3. 1956
  • 4. 1984

Maximum number of Partners in a firm are ____ according to Companies Act 2013

  • 1. 10
  • 2. 25
  • 3. 20
  • 4. 50

Difficult Words & Their Meanings:

  • Partnership: A business structure where two or more people own and manage a business together, sharing its profits and losses.
  • Final Accounts: Financial statements like the Profit & Loss Account and Balance Sheet, prepared at the end of an accounting period to show a business's financial health and performance.
  • Book-keeping: The activity of recording the financial transactions of a business in an orderly manner.
  • Accountancy: The overall process of recording, classifying, summarizing, interpreting, and communicating financial information of a business.
  • Appropriate: Suitable or fitting for a particular purpose or situation.
  • Alternative: One of several possibilities or choices.
  • Partnership Agreement (Deed): A formal written contract between partners that outlines the terms, conditions, rights, and duties of their partnership.
  • Profits: The money a business makes after deducting all its costs and expenses from its revenues.
  • Ratio (Profit-sharing): The agreed proportion in which partners will share the profits or bear the losses of the business.
  • Net Profit: The final profit of a business after all operating expenses, interest, and taxes are subtracted from the gross profit.
  • Net Loss: The financial outcome when a business's total expenses are higher than its total income.
  • Trading Account: An account prepared to determine the gross profit or gross loss from a business's primary buying and selling activities.
  • Capital Account: An account that records each partner's initial investment, additional capital, withdrawals, and share of profits or losses.
  • Intangible Asset: A non-physical asset that has value for a business, such as brand reputation (goodwill), patents, or copyrights.
  • Goodwill: The value of a business's reputation, customer base, and other non-physical advantages that contribute to its earning capacity.
  • Asset: Any item of economic value owned by a business that can be converted into cash or used to generate income.
  • Loan Advanced (by partner): Funds provided by a partner to the firm as a loan, which the firm is obliged to repay, typically with interest.
  • Liability: A business's financial debts or obligations to others that arise from past transactions.
  • Tenure: The period or duration for which a partner is part of the firm or holds a particular position.
  • HSC (Higher Secondary Certificate): A school-leaving certificate in India obtained after completing the 12th grade.