Important Questions for Chapter 7- Dissolution of Partnership Firm

Important Questions with Answers for CBSE Class 12 Accountancy Chapter 7- Dissolution of Partnership Firm which is outlined by expert Accountancy teachers from the latest version of CBSE (NCERT) books.

CBSE Class 12 Accountancy Chapter -7 Important Questions

Question 1

What does Dissolution of Partnership Firm mean?

Answer: Dissolution of Partnership Firm refers to the situation in which relationship between all partners of firm is dissolved.

Question 2

What does Dissolution of Firm mean?

Answer: Dissolution of Firm means closure of the enterprise and end of the business association among all the partners.

Question 3

What are the modes of Dissolution of Firm?

Answer: The modes by which a Firm can be dissolved are:

• Mutual agreement
• Compulsory dissolution
• By notice
• The occurrence of an event
• Dissolution by court

Question 4

Mention the accounting treatment on the dissolution of the firm.

Answer: Dissolution process begins by preparing the following accounts in the enterprise’s books:

• Realisation A/c
• Partner’s loan A/c
• Partner’s capital A/c
• Bank or cash A/c

Question 5

Pass the necessary journal entry ‘for closing the asset A/c’.

Answer: The journal entry passed is,

Realisation A/c Dr.

To Various assets A/c

Also Check: What is Dissolution of Partnership?

Question 6

Pass the necessary journal entry when realisation expenses are borne and paid by the enterprise.

Answer: The journal entry passed is,

Realisation A/c Dr.

To Cash/bank A/c

Question 7

Pass the necessary journal entry when realisation expenses were to be borne by the enterprise but are paid by a partner.

Answer: The journal entry passed is,

Realisation A/c   Dr.

To   Concerned partner’s capital A/c

Question 8

During the dissolution of a firm, if goodwill appears in the balance sheet, it is transferred to,

Answer: Realisation A/c

Question 9

An unrecorded asset when realised is credited to,

A. Realisation A/c

B. Partners’ capital A/c

C. None of the above

Answer: B. Realisation A/c

Question 10

An unrecorded liabilities when paid is debited to,

A. Realisation A/c

B. Partners’ capital A/c

C. None of the above

Answer: B. Realisation A/c

Question 11

Pass the necessary journal entry when realisation expenses are borne and paid by the same partner.

Answer: No entry

Question 12

Pass the necessary journal entry when realisation expenses are borne by a partner and paid by the firm.

Answer: The journal entry passed is,

Concerned partner’s capital A/c Dr.

To    Cash/bank A/c

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