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ACC 407 WEEK 1 QUIZ

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Question;1. Question;The terms of a partnership agreement;provide that one of the partners is to receive a salary allowance of $30,000;plus a bonus of 20 percent of income after deduction of the bonus and the salary;allowance. If income is $150,000, the bonus should be;$18,000;$20,000;$24,000;$30,000;2. Question;During the liquidation of the FGH;partnership, a cash distribution was made to all the partners, who share;profits and losses 60 percent, 20 percent, and 20 percent, respectively.;Assuming that the cash distribution referred to was made properly, how much;would G receive if an additional $60,000 was distributed?;$60,000;$20,000;$17,000;$12,000;3. Question;Which of the following items are;important in the determination of safe installment payments to partners?;I. Deficits created in capital;accounts are distributed to the remaining partners.;II. All unsold noncash assets are;assumed to be worthless.;I only;II only;Both I and II;Neither I nor II;4. Question;Which of the following statements best;describes accounting for a partnership?;A partnership may be a profit or a;nonprofit entity.;A partnership may use federal income;tax rules to account for transactions in their journals and ledger;accounts.;A partnership's equity section;contains both capital and retained earnings accounts.;A partnership may only distribute;money through a dividend payment.;5. Question;A partnership is a(n);I. accounting entity.;II. taxable entity.;I only;II only;Neither I nor II;Both I and II;6. Question;Griffin and Rhodes formed a;partnership on January 1, 2009. Griffin contributed cash of $120,000 and Rhodes;contributed land with a fair value of $160,000. The partnership assumed the;mortgage on the land which amounted to $40,000 on January 1. Rhodes originally;paid $90,000 for the land. On July 31, 2009, the partnership sold the land for;$190,000. Assuming Griffin and Rhodes share profits and losses equally, how;much of the gain from sale of land should be credited to Griffin for financial;accounting purposes?;$0;$15,000;$35,000;$45,000;7. Question;In the computation of a partner's Loss;Absorption Power (LAP), the individual partner's capital balance and;profit-and-loss percentage are used in which of the following ways?;Option A;Option B;Option C;Option D;8. Question;On a partner's personal statement of;financial condition, assets and liabilities are presented;I. As current and noncurrent.;II. In order of liquidity and;maturity.;I;II;Both I and II;Neither I nor II;9. Question;The capital balances, prior to the;liquidation of the XYZ partnership, were as follows;X, Y, and Z share profits and losses;in the ratio of 5:3:2. As a result of a loan, the partnership owes Y $80,000.;Using the information above, which partner has the highest Loss Absorption;Power (LAP) prior to liquidation?;X;Y;Z;Both X and Y;10. Question;The BIG Partnership has decided to;liquidate at December 31, 20X8. The capital and loan balances of the partners;at December 31, 20X8, are provided below;If you were to calculate the;Loss Absorption Power for each partner, how would the partners rank (from;highest to lowest LAP)?;B, I, G;I, B, G;B, G, I;G, I, B;Offline

 

Paper#37619 | Written in 18-Jul-2015

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