MOCK TEST PAPER - 1

COMMON PROFICIENCY TEST

Time Allowed 2 Hours Maximum Marks 100
SECTION A: FUNDAMENTALS OF ACCOUNTING
1. Gopal was holding 100 shares of Rs. 10 each of a company on which he had paid Rs. 3 on
application and Rs. 2 on allotment but could not pay Rs. 2 on first call. Directors forfeited his
shares. Share capital will be debited by
(a) Rs. 1,000
(b) Rs. 700
(c) Rs. 500
(d) Rs. 800
2. A manager gets 5% commission on net profit after charging such commission. If gross profit is
Rs. 48,000 and expenses of indirect nature other than managers commission are Rs.
6,000. Commission amount will be ________
(a) Rs. 2,100
(b) Rs. 2,000
(c) Rs. 2,200
(d) Rs. 2,400
3. A machinery of Rs. 3,000 was sold for Rs. 4,200. Depreciation provision till date of sale was
Rs. 400 and commission paid to the selling agent was Rs. 420 and wages paid to the workers
for removing the machine was Rs. 30. Profit on sale of machinery will be
(a) Rs. 1,200
(b) Rs. 1,000
(c) Rs. 1,150
(d) None of the three
4. On 1st January, 2016 Badri of Bombay consigned 100 cases (cost price Rs. 7,500) at a proforma
invoice price of 25% profit on sales to his agent Anil of Agra. On the same date Badri paid
non recurring expenses of Rs. 600. On 5th January Anil took delivery and paid Rs. 1,200 for
octroi. On 31st January he sold 80 cases for Rs. 10,500. He charged Rs. 775 as his commission.
Consignment profit will be
(a) Rs. 2,285
(b) Rs. 2,200
(c) Rs. 2,500

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 (d) Rs. 2,000
5. Anwar Ltd. Purchased building worth Rs. 99,00,000 and issued 12% debentures of
100 each at a premium of 10%. Premium amount will be
(a) Rs. 9,00,000
(b) Rs. 8,00,000
(c) Rs. 7,00,000
(d) Rs. 10,00,000
6. C and D entered into a Joint Venture to construct a bridge. They did not open separate
set of books. They shared profits and losses as 3:2. C contributed Rs. 1,50,000 for
purchase of materials. D paid wages amounting to Rs. 80,000. Other expenses paid were
by C Rs. 5,000 and D Rs. 15,000
C purchased one machine for Rs. 20,000. The machine was taken over by C for
Rs. 10,000. Total contract value of Rs. 3,00,000 was received by D. What will be the
profit on venture?
(a) Rs. 30,000
(b) Rs. 40,000
(c) Rs. 20,000
(d) Rs. 15,000.
7. Estimated life of an asset is 10 years and estimated scrap value is Rs. 3,200.
Depreciation as per SLM is charged at Rs. 2,500 every year on the asset. Find the cost
of the asset.
(a) Rs. 25,000
(b) Rs. 28,200
(c) Rs. 28,000
(d) Rs. 30,200.
8. Mr. X paid commission to his consignee Mr. Y Rs. 25,000 @ 5% on sales made by him.
Goods were sold by Mr. Y at a profit of 25% on cost. Stock in hand as on 31.3.2016 is
Rs. 50,000 at cost. What is the cost of goods sent by Mr. X on consignment to Mr. Y?
(a) Rs. 4,50,000
(b) Rs. 75,000
(c) Rs. 5,50,000
(d) Rs. 6,00,000.

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9. Rent paid is debited to landlords personal account. It is
(a) Not an error
(b) Error of omission
(c) Error of commission
(d) Error of principal.
10. Cost of machinery Rs. 75,000, salvage value Nil, estimated life 4 years. Depreciation for
the first year by sum of digit method is
(a) Rs. 30,000
(b) Rs. 15,000
(c) Rs. 12,000
(d) Rs. 7,500.
11. Dividends are usually paid as a percentage of
(a) Authorised share capital
(b) Net profit
(c) Paid up capital
(d) Called up capital
12. A trader gives the cash book balance of bank column to be Rs. 10,000 (Cr.)
Find the pass book balance, if interest debited in pass book not recorded in cash book
Rs. 150 and cheque issued but not presented Rs. 2,500.
(a) Rs. 8,000
(b) Rs. 7,650
(c) Rs. 7,500
(d) Rs. 8,250.
13. P shows a profit of Rs. 7,00,000 for the year ended 31.3.2016. The figure has been
arrived at after charging following against revenue:
(i) Purchase of Car on 28.3.2016 for use in business Rs. 3,00,000 and treated as
vehicle expenses.
(ii) Omitted to record unpaid electricity bills for February and March, 2016 of Rs. 15,000
per month. The correct profit for the year ended 31 st March, 2016 will be
(a) Rs. 8,30,000
(b) Rs. 9,00,000
(c) Rs. 9,70,000

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 (d) Rs. 10,30,000.
14. The total of debit and credit side of Mr. Raja Rams Trial balance as on 31st March, 2016
were Rs. 20,000 and Rs. 10,000 respectively. The difference was transferred to
suspense A/c. On 4th April 2016, it was found that the total of sales book was carried
forward as 5,000 instead of 4,000. The balance of suspense A/c after rectification of this
error will be -
(a) Rs.11,000
(b) Rs. 10,000
(c) Rs. 9,000
(d) Rs. 12,000
15. Goodwill is to be calculated at one years purchase of the average of the last 3 years
profit. The profit of the first year was Rs.6,000,secondyeartwicetheprofitofthefirstyearand
the third year one and half times of the profit of the second year goodwill amount will be -
(a) Rs.10,000
(b) Rs.12,000
(c) Rs.11,000
(d) Rs.13,000
16. Huge Ltd. issued 25,000 equity shares of Rs.100 each at a premium of Rs. 15 each
payable as Rs. 25 on application, Rs. 40 on allotment and balance in the first call. The
applications were received for 75,000 equity shares but the company issued to them only
25,000 shares. Excess money was refunded to them after adjustment for further calls.
Last call on 500 shares were not received and were forfeited after due notice. The above
is the case of
(a) Oversubscription.
(b) Pro-rata allotment.
(c) Forfeiture of shares.
(d) All of the above
17. When balance as per cash book is the starting point, and cheques issued for payment
Rs. 400 was wrongly credited by Bank as Rs.900 then in the bank reconciliation
statement cash balance will be
(a) Added by Rs. 1300
(b) Subtracted by Rs. 1,300
(c) Added Rs. 900
(d) Subtracted by Rs. 400

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18. There was difference in the bank column of cash book and passbook by Rs. 2,500. On
scrutiny it was found that interest of Rs. 500 charged directly by the bank was not
entered in the cash book. The same was adjusted in the cashbook before reconciliation
statement. Now, in the bank reconciliation statement, this interest of Rs.500 is to be
(a) Added to the cash book balance.
(b) Subtracted from the cash book balance.
(c) Ignored while preparing bank reconciliation statement.
(d) None of the above.
19. The plant and machinery account of a firm had a debit balance of Rs. 1,47,390 (before
charging depreciation for the year) as on 31st December, 2016. On 1st Jan., 2013 firm started
business and has been following the practice of charging full years depreciation every year
on Diminishing balance method @ 15%. Cost of machinery on 01.01.2013 will be
(a) Rs. 2,40,000
(b) Rs.2,00,000
(c) Rs.2,50,000
(d) None of the three
20. Fluctuating capital account is credited with
(a) Interest on capital
(b) Profit of the year
(c) Salaries or Remuneration of the partners
(d) All of the above
21. All of the following have debit balance except
(a) 6% Debentures
(b) Loan to contractor
(c) Interest on debentures
(d) Audit Fee
22. Double column cash book records
(a) Only credit transactions
(b) All transactions
(c) Cash and bank transactions
(d) Cash purchase and credit sale transactions

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23. Interest on capital at 6% p.a. is to be allowed. Capital in the beginning was Rs. 3,00,000.
Interest amount will be
(a) Rs. 18,000
(b) Rs. 15,000
(c) Rs. 15,000
(d) None of the three
24. Net salary paid to employees Rs. 45,000 in cash after deducting income tax Rs. 1,000,
professional tax Rs. 200, employees provident fund Rs. 2,000, staff welfare fund Rs. 100
and recovery of loan Rs. 1,700. Salary A/c will be debited with -
(a) Rs. 50,000
(b) Rs. 45,000
(c) Rs. 48,000
(d) None of the three
25. Unexpired portion of Capital expenditure is shown in
(a) Trading account
(b) Profit and Loss a/c
(c) Balance Sheet
(d) None of the above
26. On 01.09.2016, A draws a bill on B for 30 days after sight. The date of acceptance is
08.09.2016. The maturity date of the bill will be
(a) 08.10.2016
(b) 10.10.2016
(c) 11.10.2016
(d) 09.10.2016
27. If the firm pays Income Tax on behalf of partners, such payment of personal income tax
should be treated as
(a) Income tax of firm
(b) Drawings of partners
(c) Income of the firm
(d) None of the above
28. Petty expenses paid in cash are recorded in:
(a) Purchase book
(b) Sales book

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 (c) Petty cash book
(d) Purchase return book
29. On April 1, 2016, a bill was drawn for two months. The maturity date of payment will fall on:
(a) June 1, 2016
(b) June 4, 2016
(c) June 5, 2016
(d) None of the above
30. Current assets does not include:
(a) Cash
(b) Stock
(c) Debtors
(d) Furniture & Fittings
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31. P of Faridabad sent out goods costing Rs. 45,000 to Y of Delhi at cost + 33 %. 1/10th
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of goods were lost in transit. 2/3rd of the goods received are sold at 20% above invoice
price. The amount of sale value will be:
(a) Rs. 54,000
(b) Rs. 43,200
(c) Rs. 60,000
(d) Rs. 36,000
32. Rent paid on 1st October, 2015 for the year to 30th September, 2016 was
Rs. 1,200 and rent paid on 1st October, 2016 for the year to 30th September, 2017 was
Rs. 1,600. Rent paid, as shown in the profit and loss account for the year ended 31st
December 2016, would be:
(a) Rs. 1,200
(b) Rs. 1,600
(c) Rs. 1,300
(d) Rs. 1,500
33. If repair cost is Rs. 25,000, whitewash expenses are Rs. 5,000, cost of extension of
building is Rs. 2,50,000 and cost of improvement in electrical wiring system is
Rs. 19,000; the amount to be expensed in the books will be
(a) Rs. 2,99,000
(b) Rs. 44,000

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 (c) Rs. 30,000
(d) Rs. 49,000
34. R, J and D are partners sharing profits in the ratio 7:5:4. D died on 30th June 2016 and
profits for the accounting year 2015-2016 were Rs. 24,000. How much share in profits
for the period 1st April 2016 to 30th June 2016 will be credited to Ds Account?
(a) Rs. 6,000
(b) Rs. 1,500
(c) Nil
(d) Rs. 2,000
35. Mr. A is a partner in a firm along with Mr. B. Both contributed capitals of Rs. 40,000 and
Rs. 50,000 respectively on the 1st of July, 2016. Interest on capital is to be charged
@ 10% p.a. Books of account are to be closed on 31st December, 2016. Interest on
capital is
(a) Rs. 2,500
(b) Rs. 2,000
(c) Rs. 4,500
(d) None of the above
36. E Ltd. had allotted 10,000 shares to the applicants of 14,000 shares on pro rata basis.
The amount payable on application is Rs.2. F applied for 420 shares. Calculate the
number of shares allotted and the amount carried forward for adjustment against
allotment money due from F.
(a) 60 shares; Rs. 120
(b) 340 shares; Rs. 160
(c) 320 shares; Rs. 200
(d) 300 shares; Rs. 240
37. The bill of Rs. 10,000 accepted by Ritesh on 1 July 2016, was discounted by Hitesh on
15 July 2016 for Rs. 9,600. On 4th October 2016, the bill was dishonoured and bank
notified it for Rs. 200. The amount to be received from Ritesh would be
(a) Rs. 10,600
(b) Rs. 10,000
(c) Rs. 10,200
(d) Rs. 10,400

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38. Brave Ltd. issued 60,000 shares of Rs. 10 each at a discount of Rs. 1 per share. The
application money was Rs. 2, allotment money was Rs. 4, and first call was of Rs.1. The
amount of final call will be
(a) Rs. 3
(b) Rs. 2
(c) Rs.1
(d) Nil
39. Jadu Ltd. reissued 2,000 shares, which were forfeited by crediting Share forfeiture
account by Rs. 3,000. These shares were reissued Rs. 9 per share. The amount to be
transferred to Capital Reserve account will be
(a) Rs. 3,000
(b) Rs. 2,000
(c) Rs. 1,000
(d) Nil
40. In the bank reconciliation statement, when balance as per the cash book is taken as the
starting point, then direct deposits from the customer of Rs. 2,500 in the bank will be
(a) Added
(b) Subtracted
(c) Ignored
(d) None of the above
41. Which of the following is not a transaction?
(a) Goods are purchased on cash basis for Rs. 1,000.
(b) Salaries paid for the month of May, 2016.
(c) Land is purchased for Rs. 10 lakhs.
(d) An employee dismissed from the job.
42. Following figures have been taken from the trial balance of a trader:
Purchases Rs. 30,000
Purchase Returns Rs. 5,000
Sales Rs. 40,000
Sales Returns Rs. 5,000
The amount of profit will be
(a) Rs. 10,000.

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 (b) Rs. 5,000.
(c) Rs. 7,500.
(d) None of the three.
43. Radha, Seeta and Laxmi were partners sharing profits and losses in the ratio of 2:3:5.
Seeta retired on 1 st June, 2016 and Goodwill of the firm is to be valued at Rs. 1,20,000
on that date. What will be the treatment for Goodwill ?.
(a) Profit and Loss a/c will be credited by Rs. 1,20,000.
(b) Seetas Capital a/c will be debited by Rs. 36,000 with corresponding credit to Radha
and Laxmi in their gaining ratio.
(c) Seetas Capital a/c will be credited by Rs. 36,000 with corresponding debit to Radha
and Laxmi in their gaining ratio.
(d) None of the these.
44. Find the goodwill of the firm using capitalization method from the following informati on:
Total capital employed in the firm Rs. 80,00,000
Reasonable rate of return 15%
Profits for the year Rs. 12,00,000
(a) Rs. 68,00,000.
(b) Rs. 12,00,000.
(c) Rs. 11,88,000.
(d) Nil.
45. Opening stock of the year is Rs. 20,000, Goods purchased during the year is
Rs. 1,00,000, Carriage Rs. 2,000 and Selling expenses Rs. 2,000. Sales during the year
is Rs. 1,50,000 and closing stock is Rs. 25,000. The gross profit will be:
(a) Rs. 53,000.
(b) Rs. 55,000.
(c) Rs. 80,000.
(d) Rs. 51,000.
46. 18% investment of Rs. 1,00,000 and interest received on investment Rs. 15,000 have
been given in the trial balance for the period ended on 31.3.2016. The amount of interest
outstanding in the final accounts will be ______
(a) Rs. 18,000
(b) Rs. 15,000

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 (c) Rs. 3,000
(d) Nil
47. If the profit is 25% of the cost price then it is
(a) 25% of the sales price
(b) 33% of the sales price
(c) 20% of the sales price
(d) 15% of the sales price.
48. The profits of last three years are Rs.84,000, Rs.78,000 and Rs. 90,000. Find out the
goodwill at two years purchase.
(a) Rs.84,000
(b) Rs. 1,68,000
(c) Rs. 2,52,000
(d) Rs. 72,000
49. Overdraft as per pass book is given Rs. 10,000
(i) Cheques deposited in the Bank but not recorded in Cash Book Rs. 100
(ii) Cheques drawn but not presented for payment Rs. 6,000
(iii) Bank charges recorded twice in cash book Rs. 30
Overdraft as per Cash Book will be
(a) Rs.16,000
(b) Rs. 16,130
(c) Rs. 15,000
(d) None of the three.
50. Bill payable discounted in cash by creditor. This transaction will be recorded in
(a) Journal
(b) Ledger
(c) Bank book
(d) No entry required to be made
51. A Company issued 2,000, 12% debentures of Rs. 100 each at par but redeemable at 5%
premium. Loss on issue of debentures will be
(a) Rs. 10,000
(b) Rs. 12,000
(c) Rs. 11,000

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 (d) None of the three
52. Amit, Rohit and Sumit are partners sharing profits and losses in the ratio of 5:4:3. Sumit
retires and if Amit and Rohit shares profits of Sumit in 4:3, then new profit sharing ratio
will be
(a) 4:3
(b) 47:37
(c) 5:4
(d) 5:3
53. When separate set of books is maintained, expenses paid by venture will be credited to
(a) Joint bank A/c
(b) Venturers A/c
(c) Joint Venture A/c
(d) P & L A/c
54. C and D enter in to a joint venture to share profit in the ratio of 5:3. Apart from the profits,
D is entitled to a commission of 5% of net profit after charging such commission. If net
profit of joint venture is Rs. 33,600 before charging such commission. What will be share
of profit of C and D.
(a) C will get profit Rs. 19,950 and D Rs. 11,970
(b) C will get profit Rs. 20,000 and D Rs. 12,000
(c) C will get profit Rs. 21,000 and D Rs. 2,600
(d) C will get profit Rs. 21,600 and D Rs. 12,000.
55. Delcredere commission is fixed in terms of percentage say, 10%. The Credit Sales is of
Rs. 1,00,000 and Cash Sales is of Rs. 50,000; amount of _____________commission
will be allowed.
(a) Rs. 10,000
(b) Rs. 15,000
(c) Rs. 5,000
(d) None of the above
56. Mr. X purchased a computer for Rs. 60,000 by making a down payment of Rs. 10,000
and balance of Rs. 50,000 by signing the agreement of bills payable due in 50 days. As a
result of these transactions
(a) Total assets increased by Rs. 50,000 with the corresponding increase in liability by
Rs. 50,000
(b) Total assets increased by Rs. 50,000

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 (c) Total assets increased by Rs. 60,000 with corresponding increase in liability by
Rs. 50,000
(d) Total assets increased by Rs. 60,000 with the corresponding increase in liability by
Rs. 60,000.
57. Goods destroyed by fire Rs. 20,000 and insurance company admitted full claim. Claim
receivable from insurance company will be shown in the
(a) Manufacturing account
(b) Trading account
(c) Profit and Loss account
(d) Balance Sheet.
58. X sent some goods costing Rs. 3500 at a Profit of 25% on sale on return basis to Y. Y
returned goods costing Rs. 800. At the end of accounting year, remaining goods were
neither returned nor approved by him. The stock on approval will be shown in the
Balance sheet at:
(a) 2700
(b) 2000
(c) 2700 less 5% of 2700
(d) 3500
59. In journal, the entries which pertain to outstanding expenses, prepaid expenses or
depreciation are called:-
(a) Adjusting Entries
(b) Rectification Entries
(c) Transfer Entries
(d) Closing Entries
60. Ajay Ltd. decides to redeem 10,000 Preference Shares of Rs. 10 each at a 10%
premium. Balance in Profit & Loss A/c is Rs. 65,000 and in Securities Premium A/c is
Rs. 5,000. Calculate the minimum number of equity shares of Rs. 10 each to be issued
for the purpose of redemption, if fresh shares are to be issued at par.
(a) 13,125 Shares
(b) 5,625 Shares
(c) 13,750 Shares
(d) 4,000 Shares

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 SECTION B: MERCANTILE LAW
61. Law of contract-
(a) Is the whole law of obligations
(b) Is the whole law of agreements
(c) Deals with only such legal obligation which arise from agreement
(d) Deals with social agreements
62. An offer comes to an end by-
(a) Acceptance
(b) Communication
(c) Revocation
(d) None of the above
63. Communication of acceptance is not necessary
(a) By performance of conditions of the offer by offeree
(b) By acceptance of consideration by the offeree.
(c) By acceptance of benefit/service by the offeree
(d) All the above.
64. Goods displayed in a shop window with a price label will amount to-
(a) Offer
(b) Invitation to offer
(c) Acceptance of offer
(d) None of these
65. X agrees to sell his bicycle to Y for Rs. 1,000 or Rs. 2,000. Is a contract created
between the two parties?
(a) Yes
(b) No
(c) Cant say
(d) None of the above
66. A telephonic acceptance is complete when the offer is-
(a) Spoken into the telephone
(b) Heard but not understood by the offeror
(c) Heard and understood by the offeror

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 (d) Is received, heard and understood by some person in the offerors house
67. The exceptions to the rule a stranger to a contract cannot sue are-
(a) Beneficiaries in the case of trust
(b) Family settlement
(c) Assignment of contract
(d) All the above
68. The inadequacy of consideration may be taken into account by the court -
(a) In determining the question whether the consent of the promisor was freely given
(b) Always in all the cases
(c) When the parties complain
(d) When the promisor has not performed his promise
69. P renders some service to D at Ds desire. After a month D promises to compensate P
for the service rendered to him, it is a
(a) Present consideration
(b) Past consideration
(c) Future consideration
(d) None of these
70. A contract for the benefit of the minor is:
(a) Valid
(b) Void
(c) Voidable
(d) Illegal
71. A buys a gift on her friends birthday thinking that it is worth Rs. 100 when in fact it is
worth only Rs. 50. There has been no misrepresentation on the part of the seller. The
contract is:
(a) Valid
(b) Void
(c) Voidable
(d) Unenforceable
72. Active concealment of fact is associated with which one of the following?
(a) Misrepresentation

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 (b) Undue influence
(c) Fraud
(d) Mistake
73. While obtaining the consent of the promise, keeping silence by the promisor when he has
a duty to speak about the material facts, amounts to consent obtained by:
(a) Coercion
(b) Misrepresentation
(c) Mistake
(d) Fraud
74. If a party stands in a fiduciary relation to the other:
(a) He cannot dominate
(b) He can dominate the will of another
(c) The trust should be maintained
(d) None of these
75. A and B agree to deal in smuggled goods and share the profits. A refuses to give Bs
share of profit. In this case:
(a) B can enforce the agreement in the court.
(b) B can only claim damages.
(c) B has no remedy as the contract is illegal.
(d) B can enforce the contact or claim damages.
76. A paid Rs. 500 to a Government servant to get him a contract for the canteen. The
Government servant could not get the contract. Can A recover Rs. 500 paid by him to
the Government servant?
(a) Yes, the agreement is opposed to public policy.
(b) No, the agreement is opposed to public policy.
(c) No, the agreement is a voidable agreement and can be avoided by A.
(d) No, the agreement falls under section 23 and hence illegal.
77. If the contingent depends on the mere will of the promisor it would be
(a) Valid
(b) Void
(c) Illegal
(d) Depends on the circumstances

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78. A contracted with B to repair Bs house. B refuses to point out to A the places in which
his house requires repair. Is A excused from his responsibility?
(a) No, A must repair the house.
(b) A should request B to co-operate.
(c) Yes, B must point out the places in which his house requires repairs.
(d) None of the above.
79. Ordinary damages will be awarded in cases where
(a) The loss naturally flows from the breach of contract
(b) The loss is remotely connected with the breach of contract
(c) The loss is unusual and arises out of special circumstances peculiar to the contract
(d) None of these
80. A person contracted to deliver a part of a specific crop of potatoes. The potatoes were
damaged by blight though no fault of the party. The contract is -
(a) Valid
(b) Voidable
(c) Void due to frustration of contract
(d) Illegal
81. An agreement to sell becomes sale when -
(a) The conditions are satisfied
(b) The parties agree to change the terms of agreement
(c) When the court orders
(d) When the agreement is in writing
82. Specific goods are such goods which are -
(a) Existing and identified at the time of making the contract
(b) Identified after the making of contract but before the performance of contract
(c) Both a and b
(d) Neither a nor b
83 Conditions are stipulations -
(a) Essential to the main purpose of the contract
(b) Collateral to the main purpose of the contract
(c) Either a or b

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 (d) Neither a nor b
84. Where goods are known to be dangerous to the seller, and he also know that the buyer is
ignorant about it, there is an implied warranty -
(a) That buyer must be informed about the dangerous nature of goods
(b) That the buyer must examine the goods before taking delivery
(c) The seller must warn the buyer
(d) Both a and c
85. Property in the goods in the Sale of Goods Act means -
(a) Ownership of goods
(b) Possession of goods
(c) Asset in the goods
(d) Custody of goods
86. The process of identifying the goods and setting apart as per the intended quality or
description is called
(a) Identification
(b) Procurement
(c) Ascertainment
(d) Allocation
87 Delivery by attornment (acknowledgement) is __________.
(a) Actual delivery
(b) Symbolic delivery
(c) Constructive delivery
(d) All of these
88. Even if a substantial portion of the price is paid and only a small balance is pending, the
Seller is still regarded as an Unpaid Seller -
(a) True
(b) Partly True
(c) False
(d) None of the above
89. In an Auction Sale, the property shall be sold to -
(a) Lowest bidder

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 (b) Highest bidder
(c) Any bidder
(d) All bidders
90. Whether a stipulation is a condition or a warranty depends on-
(a) The construction of the contract
(b) The conduct of the parties
(c) The trade custom
(d) The Local law
91. A partnership formed for the purpose of carrying on particular venture or undertaking is
known as -
(a) Limited partnership
(b) Special partnership
(c) Joint Venture
(d) Particular partnership
92. Partnership is a relationship, which arises from -
(a) Operation of law
(b) An agreement
(c) Status
(d) Almighty
93 Which of the parties may be admitted to the benefits of partnership?
(a) Person of unsound mind
(b) Minor
(c) Alien enemies
(d) An insolvent.
94. Registration of the firm under the Partnership Act is -
(a) Optional
(b) Obligatory
(c) Compulsory
(d) Necessary
95. As per Indian Partnership Act, a partner in a partnership firm functions -
(a) In a dual capacity of principal and agent.

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 (b) as a principal.
(c) As an agent.
(d) Neither as a principal nor as an agent.
96. The authority of a partner to bind the firm for his acts as contained in section 19 of the
Partnership Act is known as:
(a) Express authority
(b) Legal authority
(c) Implied authority
(d) Managerial authority
97. An unregistered partnership:
(a) Can sue on matters arising otherwise than out of contract.
(b) Can sue on matters arising out of contract.
(c) Cannot be sued.
(d) Can sue and be sued.
98. Retiring partner continues to remain liable to third parties for acts of the firm
(a) Until public notice is given of the retirement.
(b) From the date of retirement
(c) Upto the close of the financial year in which he retires.
(d) So long as the firm uses his name.
99. The liability of minor partners is limited to the extent of-
(a) his share in the firm
(b) His personal assets
(c) His share in the firm as well as his personal assets
(d) He is not liable.
100. Dissolution of partnership between all the partners of a firm is called-
(a) Dissolution of partnership
(b) Dissolution of partners
(c) Dissolution of the firm
(d) Reconstitution of firm

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