1. Which of the following statements about partnership accounts is true? A. Two accounts are generally maintained for each partner, a drawing account and a capital account. B. The drawing account is credited with the partner’s withdrawal of cash or other assets during the period. C. Answer (A) is correct but (B) is false. D. Answers (A) and (B) are both correct
1. Which of the following statements about partnership accounts is true? A. Two accounts are generally maintained for each partner, a drawing account and a capital account. B. The drawing account is credited with the partner’s withdrawal of cash or other assets during the period. C. Answer (A) is correct but (B) is false. D. Answers (A) and (B) are both correct
Chapter21: Partnerships
Section: Chapter Questions
Problem 55P
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Question
1. Which of the following statements about partnership accounts is true?
A. Two accounts are generally maintained for each partner, a drawing account and a capital account.
B. The drawing account is credited with the partner’s withdrawal of cash or other assets during the period.
C. Answer (A) is correct but (B) is false.
D. Answers (A) and (B) are both correct
2. S1: If the partners did not agree as to how profits are to be divided, then such should be divided among partners equally. S2: Interest based on partner’s capital are always provided.
a. both statements are true
b. both statements are false
c. only S1 is true
d. only S1 is false.
3. S1: The form and content of the Changes in Owners’ Equity of a partnership are similar to that of a sole proprietorship with no exceptions. S2: In the entry to record distribution of net profits, the revenue and expense summary account is credited.
a. both statements are true
b. both statements are false
c. only S1 is true
d. only S1 is false
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