A 'Partner by Holding Out' is: MCQ with Answer and Explanation

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A 'Partner by Holding Out' is:

A. A minor admitted to benefits

B. A person who represents himself as a partner but is not

C. A retired partner

D. A deceased partner's legal heir

Answer: Option B

Solution (By JKSSB Mock Tests)

A person who by his conduct or words allows others to believe he is a partner may be held liable as partner by estoppel or holding out.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Question #1

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In Cost-Volume-Profit (CVP) analysis, 'Angle of Incidence' represents:

A. The angle between total sales line and total cost line above the BEP

B. The point of zero profit

C. The angle of the fixed cost line

D. The percentage of variable cost to sales

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Correct Answer: Option A

Explanation:
A wider angle of incidence on a break-even chart indicates a higher rate of profit generation once the break-even point is crossed.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

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The 'Physical Verification' of inventory is a part of:

A. Compliance procedure

B. Internal control evaluation

C. None

D. Substantive procedure

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Correct Answer: Option D

Explanation:
Physical verification is a substantive audit procedure to verify existence of inventory.

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Question #3

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If BRS is prepared starting with a credit balance as per Cash Book (overdraft), interest allowed by the bank will be:

A. Not treated in BRS

B. Treated as an error

C. Added

D. Deducted

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Correct Answer: Option D

Explanation:
Interest allowed reduces the actual bank overdraft (Pass book). To make the Cash book overdraft match this lower figure, it must be deducted.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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