This quiz on the Partner capital A/c with 20 practice questions. Test your knowledge about the concepts of partner capital A/c with this MCQ practice test. This quiz contains questions 1-20 covering what is partner capital account, format of partner capital account, what items comes in partner capital account, fixed and fluctuating capital account etc. The quiz suits well for conceptual clarity for your board exams
CBSE MCQ class 12 accounts
The below MCQ test is designed as per the latest syllabus prescribed by CBSE board. With the rise in weightage of MCQ questions, the practice of MCQ questions becomes very important. The quiz is equally useful for students of CUET exams.
How to attempt the quiz
One by one go through the below questions and select the right option. Do all the questions and in the end press submit. Instantly you will get your score and the explanation against each question. Go through your mistakes and reattempt the quiz any number of times as needed.
MCQ Quiz - Practice Questions
MCQ Quiz
Question 1
Fluctuating Capital Account may have:
C
Correct Answer: Either credit or debit balance
Fluctuating Capital Account may have either credit or debit balance depending on transactions recorded.
Question 2
Current Account under Fixed Capital Method may have:
C
Correct Answer: Either credit or debit balance
Current Account of each partner may have a credit balance or debit balance depending on appropriations and drawings.
Question 3
Credit balance in Current Account is shown in:
C
Correct Answer: Liabilities side of Balance Sheet
Credit balance in Current Account is shown in the liabilities side of Balance Sheet as it's due to the partner.
Question 4
Debit balance in Current Account is shown in:
B
Correct Answer: Assets side of Balance Sheet
Debit balance in Current Account is shown in the assets side of Balance Sheet as partner owes to the firm.
Question 5
Debit balance in Fluctuating Capital Account is shown in:
B
Correct Answer: Assets side of Balance Sheet
Capital Account having debit balance is shown in the assets side of Balance Sheet (partner owes to firm).
Question 6
In absence of information about capital method, which method is assumed?
B
Correct Answer: Fluctuating Capital Method
Fluctuating Capital Accounts Method is normally followed. In absence of any instruction, it is assumed that Fluctuating Capital Method is followed.
Question 7
Which account records only capital transactions?
B
Correct Answer: Capital Account under Fixed Method
In Fixed Capital Method, Capital Account records only capital transactions like introduction or withdrawal of capital.
Question 8
Which account records transactions other than capital transactions under Fixed Method?
C
Correct Answer: Current Account
Current Account is maintained to record transactions other than capital transactions like drawings, interest, salary, profit share.
Question 9
Difference between Fixed and Fluctuating Capital Method is based on:
B
Correct Answer: Number of accounts maintained and nature of transactions recorded
The difference is in number of accounts maintained (one vs two) and where different types of transactions are recorded.
Question 10
Opening balance in Capital Account appears on which side?
B
Correct Answer: Credit side if credit balance
Opening credit balance in Capital Account appears on the credit side (By Balance b/d).
Question 11
Opening debit balance in Capital Account under Fluctuating Method appears on:
B
Correct Answer: Debit side
Opening debit balance in Capital Account appears on the debit side (To Balance b/d) under Fluctuating Capital Method.
Question 12
Closing balance of Capital Account is calculated by:
C
Correct Answer: Balancing the account (difference between debit and credit sides)
Closing balance is calculated by balancing the account - difference between total debit side and total credit side.
Question 13
Which method provides better control and clarity about capital invested?
B
Correct Answer: Fixed Capital Method
Fixed Capital Method provides better control as capital invested remains clearly shown separately from other transactions.
Question 14
Which method is simpler as fewer accounts are maintained?
B
Correct Answer: Fluctuating Capital Method
Fluctuating Capital Method is simpler as only one account (Capital Account) is maintained per partner instead of two.
Question 15
In Fixed Capital Method, if a partner takes drawings of Rs. 50,000 against profit, which account is debited?
B
Correct Answer: Current Account
Drawings against profit are debited to Current Account in Fixed Capital Method.
Question 16
In Fluctuating Capital Method, additional capital introduced appears:
B
Correct Answer: On credit side of Capital Account
Additional capital introduced is credited (appears on credit side) to Capital Account in Fluctuating Method.
Question 17
A firm can chose to maintain only partner current A/c for maintaining partner capital
B
Correct Answer: No it is not allowed
A firm cannnot just maintain current A/c. Either maintain only capital A/c or maintain both capital A/c and current A/c
Question 18
The main purpose of maintaining Current Account in Fixed Capital Method is:
C
Correct Answer: To record transactions other than capital like appropriations and drawings
Current Account is maintained to record transactions other than capital transactions such as drawings, interest, salary, profit/loss share.
Question 19
Which transaction comes in capital A/c under both the methods
D
Correct Answer: Drawings against capital
Drawings against capital comes in capital A/c under both the methods
Question 20
How to identify if a question is for fixed capital method
C
Correct Answer: Both (A) and (B)
Question can either mention the balances of current A/c of each partner or state that fixed capital method is followed
