Accounting II Chapter 23 Review
Terms in this set (16)
(A) has a normal debit balance.
A partner's drawing account (A) has a normal debit balance. (B) has a normal credit balance. (C) can have a normal balance of either a debit or a credit. (D) increases on the credit side.
(C) distributing remaining cash to the partners.
The last step in liquidating a partnership is (A) to quit selling products and services. (B) selling all noncash assets. (C) distributing remaining cash to the partners. (D) liquidating liabilities.
(B) a debit to the partner's drawing account.
When a partner withdraws supplies from the partnership, the entry includes a (A) a debit to the partner's capital account. (B) a debit to the partner's drawing account. (C) a debit to Supplies. (D) a credit to the partner's drawing account.
(D) according to the partnership agreement.
Partnership earnings are divided (A) equally. (B) according to how long the partner has been in the business. (C) according to the age of each partner. (D) according to the partnership agreement.
(D) none of these.
A partnership distribution of net income or net loss is usually shown on (A) the trial balance. (B) the balance sheet. (C) the statement of cash flows. (D) none of these.
(A) ease of formation.
One advantage of a partnership is (A) ease of formation. (B) limited liability. (C) unlimited life of the partnership. (D) limited vision and skills.
(B) debit to Office Equipment.
When a partner invests in office equipment, the entry includes a (A) debit to the partner's capital account. (B) debit to Office Equipment. (C) credit to Cash. (D) credit to Office Equipment.
(A) being liable for your partner's actions.
A disadvantage of a partnership over other forms of business ownership is (A) being liable for your partner's actions. (B) simple tax structure. (C) having more capital available. (D) sharing work.
(D) loss on the realization.
When noncash assets are liquidated and the amount received is less than the book value of the asset liquidated, there is a (A) net income. (B) net loss. (C) gain on the realization. (D) loss on the realization.
A business in which two or more persons combine their assets and skills.
Owner's Equity Statement
A financial statement that summarizes the changes in owners' equity during a fiscal period.
Cash received from the sale of assets during liquidation of a partnership.
A written agreement setting forth the conditions under which a partnership is to operate.
Liquidation of a Partnership
The process of paying a partnership's liabilities and distributing remaining assets to the partners.
Distribution of Net Income Statement
A partnership financial statement showing net income or loss distribution to partners.
Each member of a partnership.