Which of the following items is shown in the Profit and Loss Appropriation Account of a partnership firm? MCQ with Answer and Explanation

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Which of the following items is shown in the Profit and Loss Appropriation Account of a partnership firm?

A. Rent paid to partner's building

B. Discount allowed to debtors

C. Office electricity expenses

D. Salary to partners

Answer: Option D

Solution (By JKSSB Mock Tests)

Salary to partners is an appropriation of profit, hence shown in P&L Appropriation A/c, not in P&L A/c.

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

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Question #1

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Which of the following is a direct tax levied and collected by the Union Government?

A. Excise duty

B. Sales tax

C. GST

D. Income tax

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Correct Answer: Option D

Explanation:
Income tax is a direct tax collected by the Central Government. (GST is indirect, excise duty is indirect, sales tax is state indirect).

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Question #2

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A bank reconciliation statement starting with overdraft as per Cash Book will treat a cheque issued but not presented:

A. Adjusted in capital

B. Subtracted

C. Added

D. No effect

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Correct Answer: Option C

Explanation:
When starting with overdraft as per Cash Book (negative bank balance), cheque issued reduces the overdraft in cash book but not yet in passbook, so to reconcile, add back.

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Question #3

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Under Ind AS 37, a provision should be recognized when:

A. There is a possible obligation arising from past events.

B. The amount of the obligation is contingent upon the occurrence of a future event.

C. The entity has a general business policy to repair damages to its reputation.

D. It is probable that an outflow of resources will be required to settle a present obligation, and a reliable estimate can be made.

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Correct Answer: Option D

Explanation:
Ind AS 37 mandates that a provision is recognized only when there is a present obligation (legal or constructive) from a past event, an outflow of resources is probable, and a reliable estimate can be made.

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