A partner who lends money to the firm is entitled to: MCQ with Answer and Explanation

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A partner who lends money to the firm is entitled to:

A. Interest on loan at 6% p.a.

B. Share of profit

C. Salary

D. Bonus

Answer: Option A

Solution (By JKSSB Mock Tests)

In absence of agreement, a partner is entitled to interest on loan advanced to the firm at 6% per annum as per Partnership Act, 1932.

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

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Practice More Accountancy and Book Keeping Questions

Question #1

'Unclaimed Dividend' is shown in Balance Sheet as:

A. Contingent liability

B. Current liability

C. Reserve

D. Current asset

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Correct Answer: Option B

Explanation:
Unclaimed dividend is a liability until paid or transferred to IEPF.

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

Question #2

If the total of debit side of trial balance is ₹1,50,000 and credit side is ₹1,45,000, the suspense account will be:

A. Credit ₹5,000

B. Debit ₹5,000

C. Debit ₹1,45,000

D. Credit ₹1,50,000

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Correct Answer: Option A

Explanation:
Credit side is short by ₹5,000, so suspense account is credited to balance.

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

Question #3

Which of the following is not a feature of a partnership?

A. Separate legal entity

B. Unlimited liability

C. Sharing of profits

D. Agreement between partners

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Correct Answer: Option A

Explanation:
A partnership firm does not have a separate legal entity distinct from its partners (except limited liability partnerships).

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

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