Explanation
General reserve A/c, Profit and Loss A/c, and Dividend equalization reserve A/c are all included in the Reserves and Surplus in the Balance Sheet of a company. However, Goodwill A/c is an intangible asset that is presented under Non-current assets in the Balance Sheet.
A Joint Life Policy (JLP) is an insurance policy which is taken out by the partnership firm on the joint lives of all partners. The amount of policy is payable by the insurance company either on the death or maturity of policy, whichever is earlier. The firm pays annual premium to the insurer against the policy.
A partnership firm is not a person and therefore a firm cannot enter into partnership with any firm or individual. But a partner of the partnership firm can enter into partnership with other persons and he can share the profits of the said firm with his other co-partners of the parent firm. Hence, option A is correct.
Following are a few features of a Joint Hindu Family Business:
1. The business does not require any agreement as membership is by birth, i.e. minor can also be a member.
2. It is governed by the Hindu Succession Act, 1956.
3. The maximum number of members is unlimited in Joint Hindu Family Firm.
4. Being a Hindu undivided family there must be a minimum of two related family members.
There are no restrictions as such with respect to the minimum capital requirement in case of partnership firm.
However, any amount of capital could be introduced in the form of Partners’ Contribution and the same shall be mentioned in the Partnership deed, as executed by the Partners.
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