A company is a legal entity and, as such, has an additional expense it is required to recognise in its income statement that sole traders and partnerships do not have. This additional expense is for:

Select one:

a.legal entity expenses

b.income tax

c.depreciation

d.cost of sales

Gemma and Audrey are in partnership. Their capital balances at the end of the accounting period are $200 000 and $150 000 respectively. Gemma decides to make a permanent cash withdrawal from her capital account of $75 000. Assuming the variable capital balances method (method 1) is used, the correct accounting entry to record this transaction is:

Select one:

a.DR Gemma - Retained earnings account $75 000; CR Cash account $75 000

b.DR Gemma - Retained earnings account $75 000; CR Profit distribution account $75 000

c.DR Gemma - Capital account $75 000; CR Cash account $75 000

d.DR Gemma - Capital account $75 000; CR Profit distribution account $75 000

Clear my choice

Which of these Australian accounting standards has no IASB equivalent?

Select one:

a.AASB 110 Events After the Reporting Period

b.AASB 136 Impairment of Assets

c.AASB 1031 Materiality

d.AASB101 Presentation of Financial Statements

Which of the following is not deducted from an employees' gross pay by the employer?

Select one:

a.Payroll tax

b.Income tax instalments owing to the taxation office

c.Union fees

d.Superannuation contributions

Which of the following statements concerning partnership agreements is true?

Select one:

a.The contractual authority of each partner should be specifieD.

b.The partnership agreement must be in writing.

c.It is not necessary to specify the duration of the partnership.

d.Partner's must always contribute equal amounts of capital.

Clear my choice

In a partnership, the profit and loss sharing ratio will be based:

Select one:

a.proportionately as per the capital contributions of the partners.

b.on a formula that the partners agree upon.

c.the relative business risks assumed by the partners.

d.on the relative effort contributed by the partners.