Partnership grade 10

What is a disadvantage of operating a business as a partnership?

• Partners may not agree on how to run the business.

• Partners may not have the same skills.

• The financial statements must be published.

• The risks and responsibilities are shared.

What was the closing balance on his current account?

• $30 000

• $38 000

• $40 800

• $43 600

How are these recorded in the ledger accounts of the partner?

• A

• B

• C

• D

John and Mark are in partnership. Profits and losses are shared in the ratio 3 : 2. John is entitled to an annual salary of $12 000. The profit for the year ended 31 August 2020 was $52 000.

How much would be credited to the partners’ current accounts on 31 August 2020?

• A

• B

• C

• D

A partnership maintains both current and capital accounts for each partner. An inexperienced book-keeper prepared the following account which contains errors.

What should appear as the closing balance on Owen’s capital account?

• $75 000

• $100 000

• $105 000

• $130 000

What is an advantage of forming a partnership?

• Decisions have to be recognised by all partners

• Each partner is responsible for actions of other partners.

• Profits have to be shared among the partners.

• Responsibilities can be shared between the partners.

Hassin found that he needed help to run his business. He decided to take a partner rather than employ an assistant.

Why did he decide to take a partner?

1 An assistant would not interfere with how the shop was run.

2 An assistant would not share risk.

3 A partner would introduce some additional capital.

4 A partner would take a share of the profit.

• 1 and 3

• 1 and 4

• 2 and 3

• 2 and 4

Which item would not appear in the appropriation account of a partnership?

• interest charged on partners’ drawings

• interest paid on loans from partners

• interest paid on partners’ capital

• salaries paid to partners

What was the total profit made by the partnership in the year ended 30 April 2022?

• $9000

• $15 000

• $18 000

• $27 000

Benjamin and Cody’s partnership agreement states that Benjamin is to receive an annual salary of $10 000 and that profits and losses are to be shared in the ratio 3:2. The partnership’s profit for the year is $45 000.

What is Benjamin’s total allocation of profit?

• $14 000

• $23 000

• $27 000

• $31 000