Revision Bitesize Partnership & Company Accounts
QuestionsWhat is the definition of the following terms:1) Reserve Accounts Answer 2) Interest On Capital Answer 3) Negative Goodwill Answer 4) Purchased Goodwill Answer 5) Super Profits Answer 6) Limited Company Answer 7) Limited Partner Answer 8) Capital Reserve Answer 9) Partnership Salaries Answer 10) Dividends Answer 11) Preliminary Expenses Answer 12) Revaluation Account Answer 13) Dissolution Answer 14) Preference Shares Answer 15) Intangible Asset Answer 16) Shares Answer 17) Garner V Murrary Rule Answer 18) Fluctuating Capital Accounts Answer 19) True And Fair View Answer 20) Goodwill Answer 21) Partnership Answer 22) Interest On Drawings Answer 23) Fixed Capital Accounts Answer 24) Private Company Answer 25) Ordinary Shares Answer 26) Directors Answer 27) Debenture Answer 28) Public Company Answer
Revision Bitesize Partnership & Company Accounts
Answers1) The transfer of apportioned profits to accounts for use in future years.
Question 2) An amount at an agreed rate of interest which is credited to a partner based on the amount of capital contributed by him/her.
Question 3) The name given to the amount by which the total purchase price for a business a limited company has taken over is less than the valuation of the assets at that time The amount is entered at the top of the fixed assets in the balance sheet as a negative amount (Sole traders and partnerships can use this approach instead of a capital reserve.)
Question 4) The difference between the amount paid to acquire a part or the whole of a business as a going concern and the value of the net assets owned by the business.
Question 5) Net profit less the opportunity costs of alternative earnings and alternative returns on capital invested that have been foregone.
Question 6) An organisation owned by its shareholders, whose liability is limited to their share capital.
Question 7) A partner whose liability is limited to the capital he or she has put into the firm.
Question 8) An account that can be used by sole traders and partnerships to place the amount by which the total purchase price paid for a business is less than the valuation of the net assets acquired Limited companies cannot use a capital reserve for this purpose Sole traders and partnerships can instead, if they wish, record the shortfall as negative goodwill.
Question 9) Agreed amounts payable to partners in respect of duties undertaken by them.
Question 10) The amount given to shareholders as their share of the profits of the company.
Question 11) All the costs that are incurred when a company is formed.
Question 12) An account used to record gains and losses when assets are revalued.
Question 13) When a partnership firm ceases operations and its assets are disposed of.
Question 14) Shares that are entitled to an agreed rate of dividend before the ordinary shareholders receive anything.
Question 15) An asset, such as goodwill, that has no physical existence.
Question 16) The division of the capital of a limited company into parts.
Question 17) If one partner is unable to make good a deficit on his capital account, the remaining partners will share the loss in proportion to their last agreed capitals, not in the profit/loss sharing ratio.
Question 18) Capital accounts whose balances change from one period to the next.
Question 19) The expression that is used by auditors to indicate whether, in their opinion, the financial statements fairly represent the state of affairs and financial performance of a company.
Question 20) An amount representing the added value to a business of such factors as customer loyalty, reputation, market penetration, and expertise.
Question 21) A firm in which two or more people are working together as owners with a view to making profits.
Question 22) An amount at an agreed rate of interest, based on the drawings taken out, which is debited to the partners.
Question 23) Capital accounts which consist only of the amounts of capital actually paid into the firm.
Question 24) A limited company that must issue its shares privately.
Question 25) Shares entitled to dividends after the preference shareholders have been paid their dividends.
Question 26) Officials appointed by shareholders to manage the company for them.
Question 27) Loan to a company.
Question 28) A company that can issue its shares publicly, and for which there is no maximum number of shareholders.
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