Reference no: EM132727666
Questions -
Q1. On December 31, 2020, Lucio Ting decided to withdraw from the partnership Ting, Tan, Velayo Partnership. Lucio Ting has a capital balance of $80,000 and the withdrawal is paid from the partnership assets. What is the entry to record the transaction?
a. Debit Cash $80,000, Credit Ting, Capital $80,000
b. Debit Income Summary $80,000, Credit Ting, Capital $80,000
c. Debit Ting, Capital $80,000, Credit Cash $80,000
d. Debit Cash $80,000, Credit Income Summary $80,000
Q2. On January 1, 2020, Lala Norman and Dede McGill decided to form a partnership. Assets of Dede includes Accounts Receivable amounting to $18,000 and an Allowance for Doubtful Accounts of $2,000. An independent appraiser determined that the allowance for doubtful accounts should be $3,000. How much should the Accounts Receivable be carried in the new partnership books?
a. $18,000
b. $16,000
c. $15,000
d. $20,000
Q3. During partnership liquidation, if net assets worth $400,000 are sold for $325,000, what happens to the partner's capital accounts?
a. A $325,000 loss will decrease the capital accounts of the partners
b. A $325,000 gain will increase the capital accounts of the partners
c. A $75,000 loss will decrease the capital accounts of the partners
d. A $75,000 gain will increase the capital accounts of the partners
Q4. Which of the following is/are true?
a. When cash dividend is declared, there is an increase in value and decrease in quantity of common shares.
b. Stock Dividend Distributable is a liability account.
c. Dividends Payable is a Noncurrent Liability acoount.
d. Stock Dividend would cause no changes in Shareholders' Equity
Q5. On January 10, 2020, the board of directors of Casio Corporation declares a 3 for 1 stock split. This would result to which of the following;
a. None of the above
b. Shareholders' Equity remain the same
c. Shareholders' Equity will decrease
d. Sahreholders' Equity will increase