CUET (UG) entrance exam Question Bank Solutions

Assertion (A): Preference shareholders are given a fixed rate of dividend even if the company earns no profit.

Reason (R): The preference shares have a preferential right of dividend to be paid as a fixed amount or an amount calculated at a fixed rate, which may either be free of or subject to income tax.

If the interest on drawings is omitted to be recorded, what will be the journal entry?

Guarantee of profit to a partner is given by:

If goodwill is not brought in cash by the new partner, it should be debited to his ______ Account.

Excess value of Purchase Consideration over Net Assets at the time of purchase of business is credited to:

Goodwill is a/an ______ asset.

E, F and G are partners sharing profits in the ratio of 3 : 3 : 2. As per the partnership agreement, G is to get a minimum amount of ₹ 80,000 as his share of profits every year and any deficiency on this account is to be personally borne by E. The net profit for the year ended 31st March 2020 amounted to ₹ 3,12,000. What will be the amount of deficiency to be borne by E?

Pick the odd one out:

Identify the journal entry for transferring interest on drawings to the Profit and Loss Appropriation A/c.

Which of the following items is not dealt through Profit and Loss Appropriation Account?

Analyse the case given below and answer the question that follow:

Alia, Karan and Shilpa were partners in a firm sharing profits in the ratio of 5 : 3 : 2. Goodwill appeared in their books at the value of ₹ 60,000. Karan decided to retire from the firm. On the date of his retirement, goodwill of the firm was valued at ₹ 2,40,000. The new profit sharing ratio decided among Alia and Shilpa was 2 : 3. Give the answer to the question given below:

How much will be transferred to Karan's Capital Account of the existing goodwill?

Analyse the case given below and answer the question that follow:

Alia, Karan and Shilpa were partners in a firm sharing profits in the ratio of 5 : 3 : 2. Goodwill appeared in their books at the value of ₹ 60,000. Karan decided to retire from the firm. On the date of his retirement, goodwill of the firm was valued at ₹ 2,40,000. The new profit sharing ratio decided among Alia and Shilpa was 2 : 3. Give the answer to the question given below:

What amount of goodwill will be transferred to Karan's Capital account?

Those preference shares which do not carry the right to receive arrears of dividend:

Ram, Shyam and Balweer are partners. They share profit and loss equally. Ram is guaranteed to get ₹ 30,000 profit. Any deficiency that arises, will be borne by Shyam. During the year, they earned a profit of ₹ 60,000. Which of the following statement/statements is/are correct as per the above information:

When is the Profit and Loss Appropriation Account prepared?

Pick the odd one out:

Rahul and Shubham are partners in a partnership Rahul withdraw ₹ 4,000 during the year as drawings. Interest on drawings is charged @ 15% p.a. The amount of interest on drawings at the end of the year will be ______.

When the incoming partner brings his share of premium for goodwill in cash, it is adjusted by crediting to ______.

Rehana, Shakina and Jasmine are partners. They share profit and loss in the ratio 1 : 2 : 3. Shakina is guaranteed to get ₹ 50,000 profit. Any deficiency that arises, will be borne by Rehana and Jasmine equally. During the year, they earned a profit of ₹ 6,00,000. How much money has to be given to her by Rehana and Jasmine?

Pick the odd one out: