D. K. Goel solutions for Accountancy Part A Volume 1 and 2 [English] Class 12 chapter 1 - Accounting for Partnership Firms - Fundamentals [Latest edition]

Puneet and Raju are partners in a clay toys making firm. Their capitals were ₹ 5,00,000 and ₹ 10,00,000 respectively. The firm allowed Puneet to get a commission of 10% on the net profit before charging any commission and Raju to get a commission of 10% on the net profit after charging all commissions. Following is the Profit and Loss Appropriation Account for the year ended 31st March 2022.

Raju’s commission will be ______.

Puneet and Raju are partners in a clay toys making firm. Their capitals were ₹ 5,00,000 and ₹ 10,00,000 respectively. The firm allowed Puneet to get a commission of 10% on the net profit before charging any commission and Raju to get a commission of 10% on the net profit after charging all commissions. Following is the Profit and Loss Appropriation Account for the year ended 31st March 2022.

Puneet’s share of profit will be ______.

Based on the above information you are required to answer the following question:

Manager's Commission will be recorded ______.

Based on the above information you are required to answer the following question:

In Case of Fluctuating Capitals, Interest on Capital will be recorded ______.

Based on the above information you are required to answer the following question:

Manager's Commission will amount to ______.

Based on the above information you are required to answer the following question:

Share of Profit will be ______.

Based on the above information you are required to answer the following question:

Interest on Loan by Sachi will be ______.

Based on the above information you are required to answer the following question:

Interest on Drawings will be recorded ______.

Based on the above information you are required to answer the following question:

Commission to Gauri will be recorded ______.

Based on the above information you are required to answer the following question:

Share of Profit will be ______.

You are required to answer the following question:

If the profit before interest on loan for the year amounted to ₹ 6,000, the interest allowed on loan by P will be ______.

You are required to answer the following question:

If the loss before interest on loan for the year amounted to ₹ 10,000, the interest allowed on loan by P will be ______.

You are required to answer the following question:

Interest on Loan by Partner P ______.

You are required to answer the following question:

Interest on Loan by P will be ______.

Read the following text and answer the given question:

Rent payable to Tara is ______.

Read the following text and answer the given question:

Salary payable to partners is ______.

Read the following text and answer the given question:

Net Profit for the year will be ______.

Read the following text and answer the given question:

Share of Profit will be ______.

Based on the above information you are required to answer the following question:

Interest on Charu's Loan is ______.

Based on the above information you are required to answer the following question:

Interest on Drawings will be ______.

Based on the above information you are required to answer the following question:

Net Profit for the year will amount to ______.

Based on the above information you are required to answer the following question:

Share of Profit will be ______.

Based on the above information you are required to answer the following question:

Interest on Ananya's Loan will be recorded in ______.

Based on the above information you are required to answer the following question:

Which of the following is charge against profit?

Based on the above information you are required to answer the following question:

Interest allowed on Capital will be:

Based on the above information you are required to answer the following question:

Mukti's share of net loss will be ______.

Based on the above information you are required to answer the following question:

Rent payable to Jai will be ______.

Based on the above information you are required to answer the following question:

Interest on Partap's Loan will be ______.

Based on the above information you are required to answer the following question:

Net Profit for the year will amount to ______.

Based on the above information you are required to answer the following question:

Interest on Capital will be ______.

Read the following text and answer the given question:

Interest on Capital will be recorded ______.

Read the following text and answer the given question:

Interest on Drawings will amount to ______.

Read the following text and answer the given question:

Share of Profit will be ______.

Read the following text and answer the given question:

Balance of Current Accounts will be ______.

The net profit of the firm will be ______.

Interest on drawings charged from Nixie will be ______.

Indu and Surekha are partners sharing profits and losses in the ratio of 2 : 1 with Capitals of ₹ 3,00,000 and ₹ 2,00,000.

You are required to answer the following question in the alternative case:

If the partnership deed provides for interest on Capital @ 9% p.a. and the profits for the year are ₹ 36,000, then Indu's share of interest on Capital will be ______.

Indu and Surekha are partners sharing profits and losses in the ratio of 2 : 1 with Capitals of ₹ 3,00,000 and ₹ 2,00,000.

You are required to answer the following question in the alternative case:

If the partnership deed provides for interest on Capital @ 9% p.a. and the loss for the year is 15,000, then Indu's share of interest on Capital will be ______.

Indu and Surekha are partners sharing profits and losses in the ratio of 2 : 1 with Capitals of ₹ 3,00,000 and ₹ 2,00,000.

You are required to answer the following question in the alternative case:

If the partnership deed is silent as to interest on Capital and the profits for the year are ₹ 60,000, then Surekha's share of interest on Capital will be ______.

Indu and Surekha are partners sharing profits and losses in the ratio of 2 : 1 with Capitals of ₹ 3,00,000 and ₹ 2,00,000.

You are required to answer the following question in the alternative case:

If the partnership deed provides for interest on Capital @ 9% p.a. even if it involves the firm in loss and the profits for the year are ₹ 30,000, then Indu's share of interest on Capital will be ______.

Anna and Bobby were partners sharing profits and losses in the ratio of 5 : 3. On 1st April, 2023, their capital accounts showed balances of ₹ 3,00,000 and ₹ 2,00,000, respectively. Calculate the amount of profit to be distributed between the partners if the partnership deed provided for interest on capital @ 10% p.a., and the firm earned a profit of ₹ 45,000 for the year ended 31st March, 2024.

Vishu and Himanshu are partners in a firm. From the following Balance sheet and information given, calculate interest on capitals @ 6% p.a. for the year, ending 31st March, 2026:

During the year ending 31st March, 2026, Vishu's drawings were ₹ 27,000 and Himanshu's drawings ₹ 18,000. Profit earned by the firm during 2025-26 was ₹ 87,000.

Show the distribution of profit.

Lucky, Paras and Palak are partners in a firm. Palak is guaranteed minimum profit of ₹ 40,000 as her share of profit, Paras is entitled to salary of ₹ 15,000 p.m.

The firm earned a profit of ₹ 90,000 for the year ended 31st March 2026 before allowing rent of ₹ 10,000 p.m. to Lucky for use of his property by the firm.

You are required to pass necessary Journal entries in the books of the firm.

Find out the amount of interest on capitals payable for 2025-26 and pass Adjusting Entry for Interest on Capital.

Pass adjusting and closing entries for Interest on Drawings.

How much interest on capital will be received by each partner?

1. How much amount of net profit will be transferred to Profit and Loss Appropriation A/c? 
2. What will be the amount of interest on drawings of the partners?

What is the profit for the year distributed between the partners?

X and Y are partners in a firm. They do not have any partnership deed. What should be done in the following cases:

1. X has invested ₹ 10,00,000 and Y only ₹ 5,00,000 as capital. X wants interest on capital @ 8% p.a.
2. X spends twice the time that Y devotes to the business. He wants a salary of ₹ 10,000 per month for the extra time spent by him.
3. X wants to introduce his son Rajesh into the business for a 25% share to be given out of his share of profits. Y objects to it.
4. X has advanced a loan of ₹ 2,00,000 to the firm. He claims interest @ 9% p.a.
5. Y withdraws ₹ 10,000 per month from the firm for his personal use. X claims that interest on drawings @ 12% p.a. be charged from Y.

X and Y are partners sharing profits in the ratio of 2 : 1. The undermentioned trial balance was extracted from their books as at 31st March, 2024:

You are required to prepare a Trading Profit and Loss Account and Profit and Loss Appropriation Account for the year ended 31st March, 2024, and a Balance Sheet as on that date. The following adjustments are to be made:

1. The value of the stock on March 31, 2024, was ₹ 64,000.
2. Charge depreciation on Buildings at 10%.
3. Provide for outstanding rent of ₹ 2,400.
4. Partners are entitled to interest on Capital @ 5% and X is entitled to a salary of ₹ 48,000 p.a.

Girish and Satish are partners in a firm. Their capitals on April 1, 2023, were ₹ 5,60,000 and ₹ 4,75,000, respectively. On August 1, 2023, they decided that their capitals should be ₹ 5,00,000 each. The necessary adjustments in the capitals were made by introducing or withdrawing cash. Interest on capital is allowed at 6% p.a. You are required to compute interest on capital for the year ending March 31, 2024.

On 1st April, 2023, A and B commenced business with capitals of ₹ 6,00,000 and ₹ 2,00,000, respectively. On 31st March, 2024, the net profit (before taking into account the provisions of deed) was ₹ 2,40,000. Interest on capitals is to be allowed at 6% p.a. B was entitled to a salary of ₹ 60,000 p.a. The drawings of the partners A and B were ₹ 60,000 and ₹ 40,000, respectively. The interest on drawings for A being ₹ 2,000 and B ₹ 1,000. Assuming that A and B are equal partners, prepare the Profit and Loss Appropriation A/c and Partner’s Capital Accounts as at 31st March, 2024.

Anubha and Kajal are partners of a firm sharing profits and losses in the ratio of 2:1. Their capital, were Rs 90,000 and Rs 60,000. The profit during the year were Rs 45,000. According to partnership deed, both partners are allowed salary, Rs 700 per month to Anubha and Rs 500 per month to Kajal. Interest allowed on capital @ 5% p.a. The drawings at the end of the period were Rs 8,500 for Anubha and Rs 6,500 for Kajal. Interest is to be charged @ 5% p.a. on drawings. Prepare partners capital accounts, assuming that the capital account are fluctuating.

X and Y are partners with capitals of ₹ 1,00,000 and ₹ 80,000, respectively, on 1st April, 2023, and their profit sharing ratio is 2 : 1. Interest on capital is agreed @ 12% p.a. Y is to be allowed an annual salary of ₹ 6,000. The profit for the year ending 31st March, 2024, amounted to ₹ 50,000. The manager is entitled to a commission of 10% of the profits.

Prepare Profit and Loss Appropriation Account and Capital Accounts.

Prepare Profit & Loss Appropriation Account.

A and B are partners in a firm sharing profits or losses in the ratio of 2 : 3 with capitals of ₹ 4,00,000 and ₹ 8,00,000 respectively, on 1st April, 2023. Each partner is entitled to 10% p.a. interest on his capital. B is entitled to a commission of 10% on net profit before charging any commission. A is entitled a commission of 8% of net profit after charging all commissions. Net profit for the year ended 31st March, 2024, was ₹ 4,80,000.

Prepare Profit and Loss Appropriation Account.

Y and Z are partners with capitals of ₹ 2,50,000 and ₹ 1,50,000, respectively, on 1st April, 2023. Each partner is entitled to 9% p.a. interest on his capital. Z is entitled to a salary of ₹ 60,000 p.a. together with a commission of 6% of Net Profit after charging his commission. Net profit for the year ended 31st March, 2024, amounts to ₹ 2,12,000.

Prepare Partner’s Capital Accounts:

1. When capitals are fixed.
2. When capitals are fluctuating.

Hint: When the profit-sharing ratio of the partners is not given in the question, the profits will be shared equally.

Prepare the Profit & Loss Appropriation Account and Partners' Current Accounts.

Pass Journal entries for interest on loan for the year ended 31st March, 2024.

Lata and Mamta are partners with capitals of ₹ 3,00,000 and ₹ 2,00,000, respectively, sharing profits as Lata 70% and Mamta 30%. During the year ended 31st March 2024, they earned a profit of ₹ 2,54,800 before allowing interest on the partner’s loan. The terms of partnership are as follows:

1. Interest on capital is to be allowed @ 7% p.a.
2. Lata is to get a salary of ₹ 2,500 per month.
3. Interest on a loan by Mamta to the firm of ₹ 80,000 for the whole year.
4. Interest on drawings of partners at 8% per annum. Drawings being Lata at ₹ 50,000 and Mamta at ₹ 75,000.
5. 1/10th of the net profit should be transferred to the general reserve.

Prepare the Profit and Loss Appropriation Account.

Hint:

1. Interest on loans will be calculated at 6% p.a.
2. Interest on drawings will be calculated for an average period of 6 months.
3. Transfer to General Reserve will be 10% of net profit, i.e., 10% of 250,000 = ₹ 25,000.

A, B and C are partners sharing the profits and losses in the ratio of 2 : 3 : 5. On 1st July, 2023, A and B granted loans of ₹ 2,00,000 and ₹ 1,00,000, respectively, to the firm. Show the distribution of profits/losses for the year ended 31st March, 2024, in the following cases:

Case:

1. If the profits before interest for the year amounted to ₹ 7,500.
2. If the loss before interest for the year amounted to ₹ 7,500.

Raj, Mehak, and Divya were partners in a firm sharing profits and losses in the ratio of 2 : 2 : 1. Their respective capitals were ₹ 6,00,000, ₹ 4,00,000 and ₹ 2,00,000. The partnership deed provided for the following:

1. Interest on capital @ 8% per annum.
2. Interest on drawings @ 6% per annum.
3. Interest on the partner’s loan to the firm @ 5% per annum.

During the year, Raj had withdrawn ₹ 12,000 on 1st October, 2021, while Mehak withdrew ₹ 60,000 on 1st December, 2021.

On 1st January, 2022, Divya had given a loan of ₹ 1,20,000 to the firm.

Pass the necessary journal entries in the books of the firm for the following transactions for the year ended 31st March, 2022:

1. Allowing interest on Raj’s capital.
2. Charging interest on Mehak’s drawings.
3. Providing interest on a loan given to the firm by Divya.

Also pass transfer entries in the Profit and Loss Account/Profit and Loss Appropriation Account, as the case may be.

A, B and C are partners in a firm sharing profits and losses equally. On 1st April, 2023, their fixed capitals were ₹ 8,00,000, ₹ 6,00,000 and ₹ 6,00,000, respectively. On 1st October 2023, A advanced ₹ 1,00,000 to the firm, whereas C took a loan of ₹ 1,50,000 from the firm on the same date. It was agreed among the partners that C will pay interest @ 10% p.a.

Profit for the year ended 31st March, 2024, amounted to ₹ 4,20,000 before allowing or charging interest on loans. Pass journal entries for interest on loans and prepare current accounts of the partners.

Hint: Interest on A’s loan will not be credited to his current account. It will be credited to his loan A/c.

Hemant and Sameer are partners in a firm. On 1st December 2023, Hemant gave a loan to the firm of ₹ 5,00,000. On the same date, the firm gave a loan of ₹ 2,00,000 to Sameer. They do not have an agreement as to interest.

The firm earned a profit of ₹ 3,70,000 (before any interest) for the year ended 31st March, 2024. Pass journal entries for interest on loans and distribution of profit for the year ended 31st March, 2024.

Hints:

1. Interest on a loan by Hemant will be provided @ 6% p.a.
2. Interest on loan by Sameer will not be charged.

Pass the journal entries for the above transactions for the year ended 31st March, 2024.

You are required to draw Profit & Loss Appropriation Account for the year ended 31st March, 2024.

Prepare an account showing the distribution of profit/loss.

Hint: Salary to Partners and interest on capitals will not be provided and P & L App. A/c will not be prepared since the firm has suffered loss.

The firm incurred a loss of ₹ 60,000 during the year ended 31st March, 2024 before above adjustments. You are required to prepare an account showing the distribution of profit/loss.

Parul and Rajul were partners in a firm, sharing profits and losses in the ratio of 5 : 3. The balance in their fixed capital accounts on 1^st April, 2023 were: Parul ₹ 6,00,000 and Rajul ₹ 8,00,000. The partnership deed provided for allowing interest on capital at 12% per annum. The net profit of the firm for the year ended 31^st March, 2024 was ₹ 1,26,000.

Prepare Profit and Loss Appropriation Account for the year ended 31^st March, 2024. Show your working clearly.

Mr. Ashok Gupta is a partner in a firm. He withdrew the following amounts during the year ended 31st March, 2025:

Calculate interest on drawings @ 9% p.a. for the year ended on 31st March, 2025.

A is a partner in a firm. During the year ended 31st March, 2025, A’s drawings were:

Interest on drawings is charged @ 10% per annum. Calculate interest on drawings of A for the year ended 31st March, 2025.

As per the partnership deed, interest on drawings is to be charged @ 7% p.a. Sohan, a partner of the firm, withdrew the following amounts during the year ended 31st March, 2024:

What will be the amount of interest on Sohan’s drawings?

Gopal is a partner in a firm. He withdrew ₹ 1,000 p.m. regularly on the first day of every month during the year ended 31st March, 2025, for personal expenses. If interest on drawings is charged @ 15% p.a., calculate the interest on the drawings of Gopal.

X, Y and Z are partners in a firm. You are informed that

1. X draws ₹ 4,000 from the firm at the beginning of every month,
2. Y draws ₹ 4,000 from the firm at the end of every month, and
3. Z draws ₹ 4,000 from the firm in the middle of every month.

Interest on drawings is to be charged @ 9% p.a. Calculate interest on partner’s drawings.

Calculate the interest on drawings of Mr. Aditya @ 8% p.a. for the year ended 31st March, 2025, in each of the following alternative cases:

Case:

1. If he withdrew ₹ 5,000 in the beginning of each quarter.
2. If he withdrew ₹ 6,000 at the end of each quarter.
3. If he withdrew ₹ 10,000 during the middle of each quarter.

Calculate the interest on drawings of Sh. Ganesh @ 9% p.a. for the year ended 31st March, 2024, in each of the following alternative cases:

Case:

1. If he withdrew ₹ 4,000 p.m. in the beginning of every month;
2. If he withdrew ₹ 5,000 p.m. at the end of every month;
3. If he withdrew ₹ 6,000 p.m;
4. If he withdrew ₹ 72,000 during the year;
5. If he withdrew as follows:
   

   	₹
   30th April, 2023	10,000
   1st July, 2023	15,000
   1st Oct., 2023	18,000
   30th Nov., 2023	12,000
   31st March, 2024	20,000

6. If he withdrew ₹ 12,000 in the beginning of each quarter;
7. If he withdrew ₹ 18,000 at the end of each quarter;
8. If he withdrew ₹ 18,000 during the middle of each quarter.

Gupta is a partner in a firm. He regularly drew ₹ 800 at the beginning of every month for the six months ending 31st March, 2024. Calculate interest on drawings at 15% p.a.

Gupta is a partner in a firm. He regularly drew ₹ 800 at the end of every month for the six months ending 31st March, 2024. Calculate interest on drawings at 15% p.a.

A, B and C are partners in a firm. For six months ending 31st March, 2024:

A drew regularly ₹ 15,000 in the beginning of every month. B drew regularly ₹ 20,000 at the end of every month, and C drew regularly ₹ 25,000 in the middle of every month.

Calculate interest on drawings @ 10% p.a. for six months ending 31st March, 2024.

Gargi withdrew ₹ 15,000 p.m. for six months ended 30th September, 2024. Calculate interest on drawings @ 8% p.a. in the following cases for the year ended 31st March, 2025.

1. When she withdrew the amount in the beginning of every month.
2. When she withdrew the amount in the middle of every month.
3. When she withdrew the amount at the end of every month.

Calculate interest on A's drawings:

1. If he has withdrawn ₹ 60,000 on 1st October, 2022 and rate of interest on drawings is 8% per annum.
2. If he has withdrawn ₹ 60,000 on 1st October, 2022 and rate of interest on drawings is 8%.

Books are closed on 31st March, 2023.

Calculate the amount of Era’s monthly drawings for the year ended 31st March, 2023, in the following cases when interest is charged on drawings @ 10% p.a.

1. When she withdrew a fixed amount at the beginning of each month, and interest on drawings is ₹ 5,200.
2. When she withdrew a fixed amount at the end of each month and interest on drawings is ₹ 6,600.

Sneha is a partner in a firm. Calculate the amount of Sneha’s quarterly drawings for the year ended 31st March, 2023, in the following cases when interest is charged @ 10% p.a.

1. When she withdrew a fixed amount in the beginning of each quarter and interest on drawings is ₹ 3,750.
2. When she withdrew a fixed amount at the end of each quarter and interest on drawings is ₹ 3,000.

Anamika and Monika are partners in a firm. Anamika withdrew ₹ 25,000 at the end of each month, and interest on drawings was calculated at ₹ 8,250 at the end of the year. What is the rate of interest on drawings?

Shruti and Gayatri are partners in a firm. Shruti withdrew ₹ 60,000 at the end of each quarter, and interest on drawings was calculated to be ₹ 6,300 at the end of the year. What is the rate of interest on drawings?

Partner A withdrew ₹ 70,000 in the middle of each half year. Calculate the rate of interest on drawings if the amount of interest charged at the end of the year was ₹ 8,400.

Ascertain the amount of each drawing made by B, during the year ending 31st March, 2026, if he withdrew a fixed amount at the beginning of every alternate month starting from 1st April, 2025. The interest on drawings was ₹ 4,725 charged @ 9% p.a.

X and Y are partners sharing the profits and losses in the ratio of 2 : 1 with capitals of ₹ 50,000 and ₹ 30,000, respectively. Show the distribution of profits in each of the following alternative cases:

1. If the partnership deed is silent as to the interest on capital and the profits for the year are ₹ 9,000.
2. If the partnership deed provides for interest on capital @ 6% p.a. and the losses for the year are ₹ 6,000.
3. If the partnership deed provides for interest on capital @ 6% p.a. and the profits for the year are ₹ 9,000.
4. If the partnership deed provides for interest on capital @ 6% p.a. and the profits for the year are ₹ 3,000.
5. If the partnership deed provides for interest on capital @ 6% p.a., even if it involves the firm in loss and the profits for the year are ₹ 3,000.

A and B contribute ₹ 4,00,000 and ₹ 3,00,000, respectively, as their capitals. They decide to allow interest on capital @ 8% p.a. Their respective share of profit is 3 : 2 and the profit for the year is ₹ 42,000 before allowing for interest on capital. Show the distribution of profits:

1. Where there is no agreement except for interest on capital and
2. Where there is a clear agreement that the interest on capital will be allowed even if it involves the firm in loss.

Pass necessary journal entries in the books of the firm allowing interest on capital and division of profit/loss among the partners.

On 1.4.2013, Brij and Nandan entered into a partnership to construct toilets in government girls schools in the remote areas of Uttarakhand. They contributed capitals of Rs 10,00,000 and Rs 15,00,000 respectively. Their profit sharing ratio was 2:3 and interest allowed on capital as provided in the Partnership Deed was 12% per annum. During the year ended 31.3.2014, the firm earned a profit of Rs 2,00,000

Prepare Profit and Loss Appropriation Account of Brij and Nandan for the year ended 31.3.2014

Kavita and Leela are partners with capitals of ₹ 6,00,000 and ₹ 4,00,000 and sharing profits and losses in the ratio of 2 : 1. Their partnership deed provides that interest on capital shall be provided @ 8% p.a., and it is to be treated as a charge against profits. Prepare relevant accounts to allocate the profit in the following alternative cases:

1. If profit for the year is ₹ 1,10,000.
2. If profit for the year is ₹ 35,000.
3. If loss for the year is ₹ 10,000.

Hint: Interest on capital will be recorded in the profit and loss account since it is a charge against profits.

Lalan and Balan were partners in a firm sharing profits in the ratio of 3 : 2. Their fixed capitals on 1st April, 2023, were Lalan, ₹ 1,00,000 and Balan, ₹ 2,00,000. They agreed to allow interest on capital @ 12% per annum and to charge on drawings @ 15% per annum. The firm earned a profit, before all the above adjustments, of ₹ 30,000 for the year ended 31st March, 2024. The drawings of Lalan and Balan during the year were ₹ 3,000 and ₹ 5,000, respectively. Showing you calculations clearly, prepare a Profit and Loss Appropriation Account of Lalan and Balan. The interest on capital will be allowed even if the firm incurs a loss.

After the accounts of the partnership have been drawn up and the books closed off, it is discovered that interest on capitals @ 8% p.a., as provided in the partnership agreement, has been omitted to be recorded. Their capital accounts at the beginning of the year stood as follows: A ₹ 8,00,000; B ₹ 4,00,000; C ₹ 3,00,000. Their profit-sharing ratio was 2 : 1 : 1. Instead of altering the balance sheet, it is decided to pass the necessary adjusting entry at the beginning of the next year.

You are required to give the necessary journal entry.

A, B, C and D are partners sharing profits in 2 : 2 : 1 : 1. They distributed the profit for the year ending 31st March 2024, ₹ 9,00,000, without providing for the following:

1. Salary to A @ 15,000 per month.
2. Salary to B and D @ ₹ 30,000 per quarter to each partner.

Give the necessary adjusting journal entry.

A, B, and C are partners sharing profits and losses in the ratio of 1 : 2 : 3. They have omitted interest on capital @ 8% p.a. for two years ended 31st March, 2024. Their fixed capitals were ₹ 4,00,000, ₹ 6,00,000 and ₹ 8,00,000, respectively. Pass the necessary adjusting entry.

Asha, Suman and Verka were partners in a firm; their capitals were ₹ 9,00,000, ₹ 7,00,000 and ₹ 4,00,000, respectively, as of 1st April 2022. Net profit for the year ended 31st March 2023 was ₹ 1,20,000, which was distributed without providing for interest on capital @ 8% p.a. as per the partnership deed.

Pass the necessary adjustment entry.

Hint: Interest on capital is in excess of net profit.

A, B, C, and D are partners sharing profits and losses in 2 : 2 : 3 : 3 respectively. After the accounts of the year had been closed, it was found that interest on drawings @ 6% p.a. has not been taken into consideration. The drawings of the partners were A ₹ 20,000, B ₹ 24,000, C ₹ 32,000, and D ₹ 44,000. Give the necessary adjusting entry.

A and B were partners sharing profits in 2 : 1 ratio. During the year ended 31st March, 2024, A’s drawings were ₹ 50,000 per month, drawn in the beginning of every month, and B’s drawings were ₹ 25,000 per month, drawn at the end of every month. After the preparation of final accounts, it was discovered that interest on A’s drawings @ 12% p.a. was not taken into consideration. Give the necessary adjusting entry on 1st April, 2024.

Anil, Sunil, and Sanjay have omitted interest on capital for the two years ended on 31st March, 2024. Their fixed capitals in two years were Anil ₹ 8,00,000, Sunil ₹ 7,00,000, and Sanjay ₹ 3,00,000. The rate of interest on capital is 10% p.a. Their profit sharing ratios were in the first year 4 : 3 : 2 and in the second year 3 : 2 : 1.

Give the necessary adjusting entry at the beginning of next year.

On 1st April, 2023, the capitals of A and B were ₹ 4,00,000 and ₹ 2,00,000, respectively. They divided profits in their capital ratio. Profits for the year ended 31st March, 2024, were ₹ 3,00,000, which have been duly distributed among the partners, but the following transactions were not passed through the books:

1. Interest on capitals @ 12% p.a.
2. Interest on drawings A ₹ 12,000; B ₹ 10,000.
3. Commission due to B ₹ 20,000 on a special transaction.
4. A is to be paid a salary of ₹ 50,000.

You are required to pass a journal entry on 10th April, 2024, which will not affect the profit and loss account of the firm and at the same time will rectify the errors.

Kumar and Raja were partners in a firm sharing profits in the ratio of 7 : 3. Their fixed capitals were: Kumar ₹ 9,00,000 and Raja ₹ 4,00,000. The partnership deed provided for the following, but the profit for the year was distributed without providing for:

1. Interest on capital @ 9% per annum.
2. Kumar’s salary ₹ 50,000 per year and Raja’s salary ₹ 3,000 per month.

The profit for the year ended 31.3.2024 was ₹ 2,78,000.

Pass the adjustment entry.

A, B and C are partners sharing profits in the ratio of 2 : 2 : 1. Their fixed capitals were ₹ 4,00,000, ₹ 2,50,000 and ₹ 1,00,000, respectively. Net profit for the year ending 31st March, 2022, amounted to ₹ 2,20,000 which was distributed without providing for the following:

1. Salary to B ₹ 5,000 p.m. and to C ₹ 10,000 per quarter.
2. Interest on capital @ 6% p.a.
3. Commission to Manager @ 10% on net profit after charging such commission.

Pass the necessary rectifying entry.

Suresh and Ramesh were partners in a firm sharing profits in the ratio of 3 : 2. Their fixed capitals were: Suresh ₹ 9,00,000 and Ramesh ₹ 6,00,000. The partnership deed provided for the following:

1. Interest on capital @ 5% per annum.
2. ₹ 60,000 per annum salary to Suresh and salary ₹ 2,000 per month to Ramesh. The profit earned by the firm for the year ending 31-3-2024 was ₹ 2,34,000.

The profits were divided equally without providing for the above.

Pass the adjustment entry.

A, B and C were partners in a firm. Their capitals were A ₹ 1,00,000, B ₹ 2,00,000 and C ₹ 3,00,000, respectively, on 1st April, 2023. According to the partnership deed, they were entitled to an interest on capital @ 5% p.a. In addition, A was also entitled to draw a salary of ₹ 5,000 per month. C was entitled to a commission of 5% on net profits. The net profits for the year ended 31st March, 2024, were ₹ 3,60,000, distributed in the ratio of their capitals without providing for any of the above adjustments. The profits were to be shared in the ratio 2 : 3 : 5. Pass the necessary adjustment entry showing the workings clearly.

X, Y and Z are partners in a firm sharing profits and losses in the ratio 5 : 3 : 2. Their capitals (fixed) are ₹ 2,00,000; ₹ 1,50,000; and ₹ 1,25,000, respectively. For the year ended 31st March, 2024, interest on capital was credited to them @ 8% instead of 10%.

Give the adjusting journal entry.

Showing your workings clearly, pass the necessary journal entry to rectify the error.

A, B, and C were partners sharing profits in the ratio of 1 : 2 : 3. A withdrew ₹ 5,000 every month, B withdrew ₹ 60,000 during the year and C withdrew ₹ 15,000 during each quarter. It was discovered that for the year ending 31st March 2024, interest on drawings was charged @ 8% p.a., whereas there is no provision for interest on drawings in the partnership deed. Pass the necessary rectifying entry.

Hint: Interest on each partner’s drawings is ₹ 2,400.

After the accounts of a partnership have been drawn up and the books closed off, it is discovered that for the years ended 31st March, 2023 and 2024, interest has been credited to the partners upon their capitals at 5% per annum, although no provision for interest is made in the partnership agreement.

The amounts involved are:

You are required to put through an adjusting entry as on 1st April, 2024, if the profits were shared as follows in 2023, 2 : 2 : 1, and in 2024, 3 : 4 : 3.

Sachin, Kapil and Rashmi have been sharing profits in the ratio of 3 : 2 : 1 respectively. Rashmi wants that she should share profits equally along with Sachin and Kapil, and she further wants that the change in profit-sharing ratio should be applicable retrospectively for the last three years. Other partners have no objection to this. The profits for the last three years were ₹ 60,000, ₹ 47,000 and ₹ 55,000. Record the adjustment by means of a journal entry.

Mohan, Vijay and Anil are partners; their capitals on 31st March 2024, after adjustments of drawings and profits, were ₹ 30,000, ₹ 25,000 and ₹ 20,000, respectively. Profits for the year ending 31st March 2024 were ₹ 24,000. Their drawings were ₹ 5,000 (Mohan), ₹ 4,000 (Vijay) and ₹ 3,000 (Anil) for the year ending 31st March, 2024. Subsequently, the following omissions were noticed, and it was decided to bring them into account.

1. Interest on capital at 10% p.a.
2. Interest on drawings: Mohan ₹ 250, Vijay ₹ 200 and Anil ₹ 150.

Make the necessary journal entry and prepare capital accounts of partners.

The capital accounts of A, B and C showed credit balances of ₹ 5,00,000, ₹ 3,00,000 and ₹ 2,00,000, respectively, after taking into account drawings and a net profit of ₹ 3,00,000. They shared profits in the ratio of 2 : 1 : 1. The drawings of the partners during the year 2023-24 were:

1. A withdrew ₹ 10,000 at the beginning of each half year.
2. B withdrew ₹ 10,000 at the end of each half year.
3. C’s Drawings were:
   

   	₹
   1st May, 2023	6,000
   1st October, 2023	5,000
   31st Dec. 2023	4,000
   31st March, 2024	5,000

Calculate interest on partners’ capitals @ 8% p.a. and interest on partners’ drawings @ 10% p.a. for the year ended 31st March, 2024.

A and B are partners in a firm sharing profits and losses in the ratio of 2 : 1. The following was the balance sheet of the firm as at 31.3.2024.

The profits of ₹ 4,50,000 for the year ended 31.3.2024 were divided between the partners without allowing interest on capital @ 9% p.a. and without charging interest on drawings @ 12% p.a. During the year A withdrew ₹ 1,00,000 and B ₹ 50,000.

Pass the necessary adjustment journal entry and show your working clearly.

Hint: Interest on drawings will be charged for 6 months.

Cheese and Slice are equal partners. Their capitals as on April 01, 2022, were Rs. 50,000 and Rs. 1,00,000 respectively. After the accounts for the financial year ending March 31, 2023 have been prepared, it is observed that interest on capital @ 6% per annum and salary to Cheese @ ₹ 5,000 per annum, as provided in the partnership deed, have not been credited to the partners’ capital accounts before distribution of profits.

You are required to give necessary rectifying entries using the Profit and Loss adjustment account.

Hints:

1. Separate entries will be passed for allowing interest on capital and salary by debiting the Profit and Loss Adjustment A/c.
2. Entry will be passed for distributing the loss on adjustment of ₹ 14,000 equally.

Piya and Shreya are partners in a firm. Their capital accounts as on 1st April, 2023, were ₹ 5,00,000 and ₹ 3,00,000, respectively.

As per provisions of the Deed:

1. Piya was entitled to a remuneration of ₹ 60,000 per year and Shreya a remuneration of ₹ 6,000 per month.
2. Interest on capitals was to be provided @ 6% p.a.
3. Profit will be divided equally among the partners.

Ignoring the above terms, the net profit of ₹ 4,00,000 for the year ended 31st March, 2024, was distributed between the partners in the ratio of their capitals.

Pass the journal entries to rectify the above errors.

Hints:

1. Entry will be passed for withdrawing the profit of ₹ 4,00,000 distributed in the wrong ratio by crediting the Profit and Loss Adjustment A/c.
2. Separate entries will be passed for allowing remuneration and interest on capital by debiting the Profit and Loss Adjustment A/c.
3. Entry will be passed for distributing the corrected net profit of ₹ 2,20,000 equally.

X, Y and Z are partners with capitals of ₹ 4,00,000, ₹ 3,00,000 and ₹ 2,00,000, respectively. They charge 8% p.a. interest on their capitals and divide the profits in the ratio of 3 : 2 : 1. X has guaranteed that Z’s share shall not amount to less than ₹ 50,000 in any one year.

Their drawings during the year were ₹ 50,000, ₹ 40,000, and ₹ 35,000, respectively. Net profits for the year before providing interest on capitals was ₹ 2,52,000. Prepare Profit and Loss Appropriation A/c and capital accounts.

Vidhi, Manas, and Ansh were partners sharing profits and losses in the ratio of 2 : 3 : 5. Ansh was given a guarantee that his share of profits in any given year would not be less than ₹ 1,20,000. Deficiency, if any, would be borne by Vidhi and Manas equally. Profits for the year ended 31st March, 2024, amounted to ₹ 2,00,000.

Pass the necessary journal entries in the books of the firm for the division of profits.

A, B and C were partners sharing profits and losses in the ratio of 3 : 2 : 1. Their capitals on 1st April, 2023, were A ₹ 500,000, B ₹ 3,00,000 and C ₹ 2,00,000.

A had personally guaranteed that in any year C’s share of profit after allowing interest on capital to all partners @ 8% p.a. and charging interest on drawings @ 10% p.a. will not be less than ₹ 1,00,000.

The net profit for the year ended 31st March, 2024, before allowing or charging any interest, amounted to ₹ 4,32,000.

• A has withdrawn ₹ 5,000 at the end of every month.
• B has withdrawn ₹ 15,000 at the end of every quarter.
• C has withdrawn ₹ 60,000 during the year.

Prepare the Profit and Loss Appropriation Account for the year 2023-24.

The partners of a firm distributed the profits for the year ended 31st March, 2024, ₹ 1,50,000 in the ratio of 2 : 2 : 1 without providing for the following adjustments:

1. A and B were entitled to a salary of ₹ 1,500 per quarter.
2. C was entitled to a commission of ₹ 18,000.
3. A and C had guaranteed a minimum profit of ₹ 50,000 p.a. to B.
4. Profits were to be shared in the ratio of 3 : 3 : 2.

Pass the necessary journal entry for the above adjustments in the books of the firm.

You are required to pass a single adjustment entry to rectify the error (show workings clearly).

X and Y were sharing profits in the ratio of 2 : 1. On 1st April, 2023, they admitted Z for `1/4`th share in the profits. Z is guaranteed a minimum profit of ₹ 1,00,000 for the year. Any deficiency in Z’s share is to be borne by X and Y in the ratio of 3 : 2. Losses for the year ending 31st March, 2024, amounted to ₹ 1,20,000. Record necessary entries.

A, B, and C are partners sharing profits in the ratio of 4 : 3 : 2. It was provided that B’s share of profit will not be less than ₹ 1,50,000 per annum. The losses for the year ended 31st March, 2024, were ₹ 85,000 before allowing interest on a loan of ₹ 1,00,000 taken from A on 1st June, 2023.

You are required to show the necessary account for the division of loss and pass the necessary journal entries.

Aakash and Baadal entered into partnership on 1^st October, 2023 with the capitals of ₹ 80,00,000 and ₹ 60,00,000 respectively. They decided to share profits and losses equally. Partners were entitled to interest on capital @ 10% per annum as per the provisions of the partnership deed.

Baadal is given a guarantee that his share of profit, after charging interest on capital will not be less than ₹ 7,00,000 per annum.

Any deficiency arising on that account shall be met by Aakash. The profit of the firm for the year ended 31^st March, 2024 amounted to ₹ 13,00,000.

Prepare Profit and Loss Appropriation Account for the year ended 31^st March, 2024.

Prepare the Profit and Loss Appropriation Account for the year ended 31st March, 2024.

Prepare Profit and Loss Appropriation Account of the firm.

The firm made a profit of ₹ 2,70,000 for the year ended 31st March, 2024 before charging any of the above items. Prepare the Profit & Loss Appropriation Account and pass the necessary journal entry for apportionment of profits.

X, Y, and Z are in the partnership, and on 1st April, 2023, their respective capitals were ₹ 2,00,000, ₹ 1,20,000 and ₹ 1,00,000. Y is entitled to a salary of ₹ 25,000 and Z, ₹ 20,000 per annum, payable before division of profits. Interest is allowed on capital at 5% per annum but is not charged on drawings. Of the net divisible profits of the first ₹ 1,00,000; X is entitled to 40 percent, Y to 35 percent, and Z to 25 percent; over that amount, profits are shared equally. The profit for the year ended 31st March, 2024, after debiting partnership salaries but before charging interest on capital, was ₹ 1,81,000, and the partners had drawn ₹ 8,000 each. Prepare partner’s capital accounts for the year.

Prepare an account showing the allocation of profits.

A and B are partners in a firm. A is to get a commission of 10% of net profit before charging any commission. B is to get a commission of 10% on net profit after charging all commissions. Net profit before charging any commission was ₹ 55,000. Find out the commission of A and B.

Calculate the interest on Drawings of Anuradha @ 9% p.a. for the year ended 31st March 2026, if she withdrew ₹ 10,000 in the beginning of each quarter.

Calculate the interest on Drawings of Bipasa @ 9% p.a. for the year ended 31st March 2026, if she withdrew ₹ 10,000 at the end of each quarter.

Calculate the interest on Drawings of Charulata @ 9% p.a. for the year ended 31st March, 2026, if she withdrew ₹ 10,000 each quarter.

Calculate the interest on Drawings of Divya @ 9% p.a. if she withdrew ₹ 4,000 p.m. on the first day of every month for six months ending 31st March, 2026.

Calculate the interest on Drawings of Esha @ 9% p.a., if she withdrew ₹ 4,000 p.m. on the last day of every month for six months ending 31st March, 2026.

Calculate the interest on Drawings of Garima @ 9% p.a., if she withdrew ₹ 4,000 p.m. for six months ending 31st March, 2026.

Seema and Tina are partners in a firm. Interest on drawings is charged @ 10% p.a. You are required to calculate the amount of drawings of each partner in the following cases:

1. Seema withdrew a fixed amount in the beginning of each month and interest on drawings is ₹ 3,900.
2. Tina withdrew a fixed amount in the beginning of each quarter and interest on drawings is ₹ 6,000.

Era, a partner withdrew ₹ 40,000 per month for her personal use from the firm in the beginning of each month. Interest on her drawings was calculated at ₹ 31,200 at the end of the year. Calculate the rate of interest on her drawings.

Calculate the rate of interest on drawings in the following case:

Charu and Suruchi are partners in a firm. Suruchi withdrew ₹ 12,000 in the beginning of each quarter and interest on drawings was calculated at ₹ 2,700 at the end of the year.

Yamini and Sonia are partners in a firm. Sonia withdrew ₹ 12,000 at the end of each quarter and interest on drawings was calculated at ₹ 1,440 at the end of the year.

P and Q were partners in a firm sharing profits in 7 : 3 ratio. Their fixed capitals were P ₹ 5,00,000 and Q ₹ 8,00,000. For the year ended 31st March, 2024, interest on capital was credited @ 12% instead of 10%. Show the necessary adjusting entry for the rectification of the error. Also show the working notes clearly.

A, B and C are partners. Their fixed capitals as on 31st March, 2024, were A ₹ 2,00,000, B ₹ 3,00,000 and C ₹ 4,00,000. Profits for the year ended 31st March, 2024, amounting to ₹ 1,80,000, were distributed. Give the necessary adjusting entry in each of the following alternative cases:

Case (a) Interest on capital was credited @ 8% p.a., though there was no such provision in the partnership deed.

Case (b) Interest on capital was not credited @ 8% p.a., though there was such a provision in the partnership deed.

Case (c) Interest on capital was credited @ 8% p.a. instead of 10% p.a.

Case (d) Interest on capital was credited @ 10% p.a. instead of 8% p.a.

Showing your workings clearly, pass the necessary adjustment entry to rectify the error.

Showing your calculations clearly, pass a necessary adjustment entry to give effect to the new agreement between Prem, Param and Priya.

John and Tanu were partners in a firm sharing profits and losses in the ratio of 1 : 2. The following was the Balance Sheet of the firm as at 31st March, 2024.

The profits of ₹ 2,40,000 for the year ended 31st March, 2024, were divided between partners without allowing interest on capitals @ 7% p.a. without charging interest on drawings @ 6% p.a.

The drawings of the partners were:

John: ₹ 12,500 per quarter at the beginning of each quarter.

Tanu: ₹ 7,500 p.m. at the end of every month.

Showing your workings clearly, pass the necessary adjustment entry in the books of the firm.

A, B and C entered into partnership on 1st July, 2023 to share Profit and Losses in the ratio of 5 : 3 : 2. A personally guaranteed that C's share of profit after charging interest on capital @ 8% per annum would not be less than ₹ 1,60,000 p.a. The capital contributed were: A - ₹ 4,00,000; В - ₹ 3,00,000 and C - ₹ 2,00,000. Profit for the year ended on 31st March, 2024 was ₹ 4,74,000. Prepare Profit and Loss Appropriation Account.

Maanika, Bhavi and Komal are partners sharing profits in the ratio of 6 : 4 : 1. Komal is guaranteed a minimum profit of ₹ 2,00,000. The firm incurred a loss of ₹ 22,00,000 for the year ended 31st March, 2018. Pass necessary journal entry regarding deficiency borne by Maanika and Bhavi and prepare Profit and Loss Account.

Anshul, Navdeep and Rajni were partners of a Chartered Accountants firm with profit sharing ratio of 2 : 1 : 2. The provisions of the partnership deed were as follows:

1. Rent of ₹ 25,000 p.m. was to be given to Rajni.
2. A monthly salary of ₹ 30,000 p.m. to Anshul.
3. Navdeep was guaranteed a minimum profit of ₹ 4,00,000, and the deficiency arising because of the guarantee to Navdeep will be borne by Anshul and Rajni in the ratio of 12 : 7.
4. Anshul guaranteed that he will earn an annual fee of ₹ 3,00,000.

The net profit earned by the firm amounted to ₹ 20,00,000, and the fee earned by Anshul during the year ended 31st March, 2024, was ₹ 2,25,000.

Prepare the Profit and Loss Appropriation Account and the Capital Accounts of partners for the year ended 31st March, 2024.

Hint: Rent will be ignored since it must have been debited to Profit and Loss A/c.

State Whether the following Statement is True or False:

It is compulsory to have a partnership agreement in writing.

State Whether the following Statement is True or False:

The business of the firm can be conducted even by one partner.

State Whether the following Statement is True or False:

Current accounts of partners are maintained under the fluctuating capital method.

State Whether the following Statement is True or False:

Unless otherwise specified, the partners have to share profits or losses in proportion to the capital contributed by them.

State Whether the following Statement is True or False:

The partners are entitled to 6% p.a. interest on capital.

State Whether the following Statement is True or False:

Interest on loan advanced by a partner to the firm shall be paid even there are losses in the business.

State Whether the following Statement is True or False:

Under fixed capital method, any addition to capital will be shown in partner's capital account.

State Whether the following Statement is True or False:

The liability of partners is limited.

State Whether the following Statement is True or False:

If a fixed amount is withdrawn by a partner on the first day of every month, interest on the total amount is charged for `6 1/2` months.

State Whether the following Statement is True or False:

Partnership business may be started without a partnership deed.

State Whether the following Statement is True or False:

Interest on partner's loan is credited to his capital account.

State Whether the following Statement is True or False:

Maximum number of partners in a partnership firm can be fifty.

State Whether the following Statement is True or False:

Each partner carrying on the business is the principal as well as agent for all the other partners.

State Whether the following Statement is True or False:

If the partnership deed is silent, interest @ 6% p.a. would be charged on the drawings made by the partner.

State Whether the following Statement is True or False:

The balance of a partner's capital account decreases with interest on drawings.

State Whether the following Statement is True or False:

There is no restriction on the number of partners in a firm.

State Whether the following Statement is True or False:

Registration of a partnership firm is compulsory.

State Whether the following Statement is True or False:

If the partnership deed is silent about the rate, interest on partner's loan is to be given @ 12% p.a.

State Whether the following Statement is True or False:

The liability of each partner is limited to the capital contributed by him.

State Whether the following Statement is True or False:

Each partner can act on behalf of the firm.

State Whether the following Statement is True or False:

Atleast three partners are needed to form a partnership firm.

State Whether the following Statement is True or False:

Partnership is established by mutual agreement.

State Whether the following Statement is True or False:

Partnership firm has separate entity from its partners.

State Whether the following Statement is True or False:

If a partner's capital account is debited, it increases his capital.

State Whether the following Statement is True or False:

If a partner devotes more time to the firm, he is entitled for salary.

State Whether the following Statement is True or False:

Loss is also known as negative profit.

State Whether the following Statement is True or False:

No partner can transfer his share in the firm without the consent of other partners.

State Whether the following Statement is True or False:

In the absence of date of drawings, interest on drawings is charged on the basis of average period.

State Whether the following Statement is True or False:

A minor can also be admitted as a partner.

Rights and duties of all partners are incorporated in ______.

In the absence of a Partnership Deed or Partnership Agreement, the mutual relations of partners are governed by ______.

Partners collectively are called ______.

Interest on Drawings under the Fixed Capital Account method is debited to ______.

Interest on Loan taken by a partner is recorded on ______ of Profit and Loss A/c.

Each partner is a ______ owner of the firm's properties.

Interest on capital is an ______ of profit.

Profit and Loss Appropriation Account is an ______ of Profit and Loss Account.

Partnership is born by ______.

In case of guarantee of minimum profit to a partner, deficiency of guaranteed partner is shared by remaining partners in ______.

In the absence of the date of withdrawal, interest should be charged for ______ months on the whole amount.

Manager's Commission is a ______ against profits.

Interest on Partner's Loan is not credited to the Partner's ______ Account.

Neha and Puja are partners. Neha drew ₹ 40,000. If the rate of interest on Drawings is 12% p.a. then interest on drawings will be ______.

Abhishek drew ₹ 2,00,000 during the year. If the rate of interest on drawings is 8% then interest on drawings will be ______.

The relation of the partner with the firm is that of Principal and an ______.

A and B are partners. Net divisible profit as per Profit & Loss Appropriation Account is ₹ 3,00,000. The total interest on partner's drawings is ₹ 8,000. A's salary is ₹ 10,000 per quarter and B's salary is ₹ 60,000 per annum. Net profit earned as per Profit & Loss Account will be ______.

A and B are partners. Net divisible profit as per Profit & Loss Appropriation Account is ₹ 3,00,000. The total Interest on partner's drawings is ₹ 8,000. A's salary is ₹ 10,000 per quarter and B's salary is ₹ 60,000 per annum. A's share of profit will be ______.

Salary paid to a partner is ______ of profit.

Rent paid to a partner is ______ against profit.

If fixed amount is withdrawn on the last day of every month and interest on drawings charged @ 10% p.a. amounts to ₹ 2,750, the drawings amount will be ₹ ______ per month.

A, B and C are partners sharing profits in the ratio of 5 : 3 : 2. As per agreement, C is to get a minimum amount of ₹ 1,00,000 as his share of profit. The net profit for the year ended 31st March, 2019 amounted to ₹ 4,00,000. Amount contributed by A will be ______.

______ Capital accounts always show a credit balance.

Match the following items:

Match the following items:

Match the following items:

Match the following items:

Match the following items:

If interest on drawings is charged @ 12% p.a.:

Match the following items:

If interest on drawings is charged @ 8% p.a.:

Match the following items:

Match the following items:

Match the following items:

Match the following items:

Match the following items:

Match the following items:

Match the following items:

A firm does not have a Partnership Deed. Based on this fact, Match the following:

Match the following items:

Following are essential elements of a partnership firm except:

Which of the following statement is true?

Sleeping partners are those who ______.

The relation of the partner with the firm is that of ______.

Number of partners in a partnership firm may be ______.

A, B, C and D are partners in a firm. What is the maximum number of additional members that can be admitted by them in the firm?

Liability of a partner is ______.

Which of the following statements are correct?

1. The liability of a partner for acts of the firm is unlimited.
2. Private assets of a partner can also be used for paying the debts of the firm.
3. Each partner is liable jointly with all other partners and also severally to the third parties for all the acts of the firm done, while he is a partner.
4. The liability of a partner is limited to the extent of his capital contribution.

A, B and C are in partnership business. A used ₹ 2,00,000 belonging to the firm without the information to other partners and made a profit of ₹ 35,000 by using this amount. Which decision should be taken by the firm to rectify this situation?

Which one of the following is not an essential feature of a partnership?

X, Y, and Z are partners sharing profits and losses equally. Their capital balances on March 31, 2024, are ₹ 80,000, ₹ 60,000, and ₹ 40,000, respectively. Their personal assets are worth as follows:

X – ₹ 20,000, Y – ₹ 15,000, and Z – ₹ 10,000

The extent of their liability in the firm would be:

Forming a partnership deed is ______.

Partnership deed is also called ______.

Which of the following is not incorporated in the Partnership Act?

When is the Partnership Act enforced?

On 1st January, 2023, Abhishek, a partner, advanced a loan of ₹ 3,00,000 to the firm. In the absence of a partnership agreement, the amount of interest on the loan for the year ending 31st March, 2023, will be ______.

A and B are partners in a partnership firm without any agreement. A has given a loan of ₹ 50,000 to the firm. At the end of the year, a loss was incurred in the business. Following interest may be paid to A by the firm:

A and B are partners in a partnership firm without any agreement. A has withdrawn ₹ 50,000 out of his capital as drawings. Interest on drawings may be charged from A by the firm:

A and B are partners in a partnership firm without any agreement. A devotes more time for the firm as compared to B. A will get the following commission in addition to profit in the firm’s profit:

In the absence of a partnership deed, the following rule will apply:

In the absence of an agreement, partners are entitled to:

1. Profit share in capital ratio. 
2. Commission for making an additional sale.
3. Interest on loans and advances by them to the firm.
4. Salary for working extra hours.
5. Interest on capital.

In the absence of agreement, partners are not entitled to ______.

Interest on capital will be paid to the partners if provided for in the partnership deed but only out of ______.

Which one of the following items is not dealt through Profit and Loss Appropriation Account? 

If any loan or advance is provided by a partner, then the balance of such loan account should be transferred to ______.

Interest on partner’s loan is credited to ______.

A partner introduced additional capital of ₹ 30,000 and advanced a loan of ₹ 40,000 to the firm at the beginning of the year. The partner will receive the year’s interest:

In the absence of Partnership Deed ______.

In the absence of express agreement, interest @ 6% p.a. is provided ______.

Which of the following items is not dealt through Profit and Loss Appropriation Account?

Is rent paid to a partner appropriation of profits?

Radhika, Mehar and Shubha were partners in a firm sharing profits and losses in the ratio of 9 : 8 : 7. If Radhika’s share of profit at the end of the year amounted to ₹ 5,40,000, Shubha’s share of profit will be:

P and Q were partners sharing profit and losses in the ratio of 2 : 1. Their capitals were ₹ 12,00,000 and ₹ 8,00,000, respectively. They were allowed interest on capital @ 6% p.a., and interest on drawings was to be charged @ 10% p.a. Their drawings during the year were P – ₹ 2,40,000 and Q – ₹ 1,60,000. Q’s share of net divisible profit as per the Profit and Loss Appropriation Account amounted to ₹ 1,60,000. Net profit of the firm before any appropriation was:

A and B were partners in a firm. Their capitals at the end of the year ending on 31.3.2021 were ₹ 3,00,000 and ₹ 1,50,000 respectively. During the year B withdrew ₹ 10,000, which was debited to his capital account. Profit for the year ended 31st March, 2021 was ₹ 32,000 which was credited to their capital accounts. During the year B introduced additional capital ₹ 32,000. What was B’s capital on 1.4.2020?

In a partnership firm, partner A is entitled to a monthly salary of ₹ 7,500. At the end of the year, the firm earned a profit of ₹ 75,000 after charging A’s salary. If the manager is entitled a commission of 10% on the net profit after charging his commission, the manager’s commission will be ______.

Which of the following statement is not true for fixed capital account?

Which of the following is true regarding salary to a partner when the firm maintains fluctuating capital accounts?

Ridhima and Kavita were partners, sharing profits and losses in the ratio of 3 : 2. Their fixed capitals were ₹ 1,50,000 and ₹ 2,00,000, respectively. The partnership deed provides for interest on capital @ 8% p.a. The net profit of the firm for the year ended 31^st March, 2023, amounted to ₹ 21,000. The amount of interest on capital credited to the current accounts of Ridhima and Kavita will be ______.

Mickey, Tom, and Jerry were partners in the ratio of 5 : 3 : 2. On 31st March 2021, their books reflected a net profit of ₹ 2,10,000. As per the terms of the partnership deed, they were entitled to interest on capital which amounted to ₹ 80,000, ₹ 60,000 and ₹ 40,000, respectively. Besides this, a salary of ₹ 60,000 each was payable to Mickey and Tom.

Calculate the ratio in which the profits would be appropriated.

Sara and Tara were partners in a firm. Their capitals as on 1st April, 2023 were ₹ 6,00,000 and ₹ 4,00,000 respectively. On 1st October, 2023, Tara withdrew ₹ 1,00,000 for personal use. According to the partnership deed, interest on capital was allowed @ 8% p.а.

The amount of interest allowed on Tara’s capital for the year ended 31st March, 2024 was:

X and Y are partners in the ratio of 3 : 2. Their capitals are ₹ 2,00,000 and ₹ 1,00,000, respectively. Interest on capitals is allowed @ 8% p.a. Firm incurred a loss of ₹ 60,000 for the year ended 31st March 2024. Interest on Capital will be:

X and Y are partners in the ratio of 3 : 2. Their capitals are ₹ 2,00,000 and ₹ 1,00,000 respectively. Interest on capitals is allowed @ 8% p.a. Firm earned a profit of ₹ 15,000 for the year ended 31st March 2024. As per the partnership agreement, interest on capital is treated as a charge on profits. Interest on capital will be ______.

A and B contribute ₹ 1,00,000 and ₹ 60,000, respectively, in a partnership firm by way of capital, on which they agree to allow interest @ 8% p.a. Their profit or loss sharing ratio is 3 : 2. The profit at the end of the year was ₹ 2,800 before allowing interest on capital. If there is a clear agreement that interest on capital will be paid even in case of loss, then B’s share will be:

Partners are supposed to pay interest on drawings only when ______ by the ______.

In a partnership firm, a partner withdrew ₹ 5,000 per month on the first day of every month during the year for personal expenses. If interest on drawings is charged @ 6% p.a., the interest charged will be ______.

Ajay is a partner in a firm. He withdrew ₹ 2,000 per month on the last day of every month during the year ended 31st March, 2024. If interest on drawings is charged @ 9% p.a., the interest charged will be ______.

Sushil is a partner in a firm. He withdrew ₹ 4,000 per month in the middle of every month during the year ended 31st March, 2024. If interest on drawings is charged @ 8% p.a., the interest charged will be ______.

Anuradha is a partner in a firm. She withdrew ₹ 6,000 in the beginning of each quarter during the year ended 31st March, 2024. Interest on her drawings @ 10% p.a. will be ______.

Bipasa is a partner in a firm. She withdrew ₹ 6,000 at the end of each quarter during the year ended 31st March, 2024. Interest on her drawings @ 10% p.a. will be ______.

Charulata is a partner in a firm. She withdrew ₹ 10,000 in each quarter during the year ended 31st March, 2024. Interest on her drawings @ 9% p.a. will be ______.

If an equal amount is withdrawn by a partner in the beginning of each month during a period of 6 months ending 31st March, 2024, interest on the total amount will be charged for ______ months.

If an equal amount is withdrawn by a partner in each month during a period of 6 months ending 31st March, 2024, interest on the total amount will be charged for ______ months.

X is a partner in a firm. He withdrew regularly ₹ 1,000 at the beginning of every month for the six months ending 31st March, 2024. If interest on drawings is charged @ 8% p.a., the interest charged will be ______.

Y is a partner in a firm. He withdrew regularly ₹ 3,000 at the end of every month for the six months ending 31st March, 2024. If interest on drawings is charged @ 10% p.a. the interest charged will be ______.

Z is a partner in a firm. He withdrew regularly ₹ 2,000 every month for the six months ending 31st March, 2024. If interest on drawings is charged @ 8% p.a., the interest charged will be ______.

Abha, Manju and Rhea were partners in a firm sharing profits and losses in the ratio of 3 : 3 : 4. During the year ended 31st March, 2023, Rhea withdrew ₹ 30,000 at the beginning of each half year. Interest on Rhea’s drawings @ 10% p.a. for the year ended 31st March, 2023, will be ______.

A partner draws ₹ 2,000 each on 1st April 2023, 1st July 2023, 1st October, 2023 and 1st January 2024. For the year ended 31st March, 2024 interest on drawings @ 8% per annum will be ______.

Usha and Mohak were partners in a firm. Usha withdrew a fixed amount at the end of every half year for the year ended 31st March, 2024. Interest on drawings is charged at 9% p.a. Interest on Usha's drawings will be charged for ______ months.

Bharat, Priti and Vansh are partners in a firm following the fixed capital method. During the year 2025-26, Bharat withdrew ₹ 18,000 in the middle of each half year. The rate of interest on drawings is 6% p.a. What is the interest on drawings charged from Bharat at the end of the year?

Anuj and Kartik were partners in a firm sharing profits and losses in the ratio of 5 : 4. Anuj withdrew ₹ 20,000 at the beginning of every alternate month starting from 1st April, 2023, during the year ended 31st March, 2024. Interest on Anuj’s drawings @ 6% p.a. for the year ended 31st March, 2024, will be:

On 1^st August, 2024 Tom, Jerry and Tyke entered into partnership with capitals of ₹ 5,00,000 each. Interest on Drawings was to be charged @ 6% p.a. For the year ended March 31, 2025, Tyke withdrew ₹ 80,000. What amount of interest on drawings will be charged from Tyke?

P, Q, and R, sharing profits in the ratio of 2 : 1 : 1, have fixed capitals of ₹ 4,00,000, ₹ 3,00,000, and ₹ 2,00,000, respectively. After closing the accounts for the year ending 31st March, 2024, it was discovered that interest on capitals was provided @ 6% instead of 8% p.a. In the adjusting entry:

A, B, and C, sharing profits in the ratio of 2 : 2 : 1 have fixed capitals of ₹ 3,00,000, ₹ 2,00,000 and ₹ 1,00,000 respectively. After closing the accounts for the year ending 31st March, 2024, it was discovered that interest on capitals was provided @ 12% instead of 10% p.a. In the adjusting entry:

X, Y and Z are partners in the ratio of 4 : 3 : 2. Salary to X ₹ 15,000 and to Z ₹ 3,000 omitted, and profits were distributed. For rectification, now X will be credited ______.

A and B are partners in a firm sharing profit in the ratio of 3 : 2. Their Balance Sheet was on 31st March, 2021, was as follows:

Net profit of the year ended 31-3-2021, ₹ 5,000, was divided without providing for interest on capital @ 10% p.a. What will be the amount of interest on A’s Capital?

Choose the correct sequence of the following transactions in context of Division of Profits.

1. Guarantee by Firm to Partners.
2. Guarantee by Partners to Firm.
3. Transfer of Profits to Profit and Loss Appropriation Account.
4. Guarantee by Partner to Partner.

Guarantee given to partner ‘A’ by the other partners ‘B and C’ means:

Annu, Banu and Chanu are partners, Chanu has been given a guarantee of minimum profit of ₹ 8,000 by the firm. Firm suffered a loss of ₹ 5,000 during the year. Capital account of Banu will be ______ by ₹ ______.

P and Q are partners sharing profits in the ratio of 1 : 2. R was a manager who received a salary of ₹ 10,000 p.m. in addition to a commission of 10% on net profits after charging such commission. Total remuneration to R amounted to ₹ 1,80,000. Profit for the year before charging salary and commission was ______.

A, B and C are partners, their partnership deed provides for interest on drawings at 8% per annum. B withdrew a fixed amount in the middle of every month, and his interest on drawings amounted to ₹ 4,800 at the end of the year. What was the amount of his monthly drawings?

X and Y are partners. X draws a fixed amount at the beginning of every month. Interest on drawings is charged @ 8% p.a. At the end of the year, interest on X’s drawings amounts to ₹ 2,600. Drawings of X were ______.

A and B are partners. B draws a fixed amount at the end of every month. Interest on drawings is charged @ 15% p.a. At the end of the year, interest on B’s drawings amounts to ₹ 8,250. Drawings of B were ______.

A and B are partners with a profit sharing ratio of 2 : 1 and capitals of ₹ 3,00,000 and ₹ 2,00,000, respectively. They are allowed 6% p.a. interest on their capitals and are charged 10% p.a. interest on their drawings. Their drawings during the year were A ₹ 60,000, and B ₹ 40,000. B’s share of net profit as per the profit and loss appropriation account amounted to ₹ 40,000. Net Profit of the firm before any appropriations was ______.

A and B are partners in a firm. They are entitled to interest on their capitals, but the net profit was not sufficient for this interest. Then the net profit will be distributed among partners in ______.

Pick the odd one out:

Pick the odd one out from the following:

1. Interest is allowed on a loan taken by the firm from a partner.
2. Rent is due to a partner of the firm for using his premises for business purposes.
3. Salary due to the manager of the firm.
4. Salary due to a partner of the firm.

Mango and Banana are partners sharing profits in 3 : 2. Their capitals were ₹ 5,00,000 and ₹ 3,00,000, respectively. As per their partnership deed, Mango was entitled to a salary of ₹ 10,000 p.a. Banana was entitled to a rent of ₹ 20,000 p.a. for his personal property that he had let out to the firm. They were also entitled to interest on their capitals @ 10% p.a. The firm earned a profit of ₹ 1,60,000 before the above adjustments. What amounts will be credited to Mango and Banana’s capital A/c if they follow a fluctuating capital system?

Sohan and Mohan are partners sharing profits and losses in the ratio of 2 : 3 with capitals of ₹ 5,00,000 and ₹ 6,00,000, respectively. On 1st January 2022, Sohan and Mohan granted loans of ₹ 20,000 and ₹ 10,000, respectively, to the firm. Determine the amount of loss borne by each partner for the year ended 31st March 2022 if the loss before interest for the year amounted to ₹ 2,500.

Girdhar, a partner, withdrew ₹ 5,000 in the beginning of each quarter, and interest on drawings was calculated as ₹ 1,500 at the end of accounting year 31 March 2022. What is the rate of interest on drawings charged?

A and B are partners. B draws a fixed amount at the end of every quarter. Interest on drawings is charged @ 15% p.a. At the end of the year, interest on B’s drawings amounted to ₹ 9,000. Drawings of B were ______.

Josh and Jeevan were partners in a firm. During the year ended 31.03.2022, Jeevan withdrew ₹ 5,000 per month starting from 30.06.2021. The partnership deed provided that interest on drawings will be charged @ 12% per annum. The average number of months for which interest on Jeevan’s total drawings will be charged is ______.

After doing the adjustments regarding drawings ₹ 40,000, share of profit ₹ 24,000 and the additional capital introduced ₹ 32,000, the capital of Ashok, a partner, as on 31.03.2022, was ₹ 5,00,000. His capital as on 01.04.2021 was ______.

In a partnership firm, which of the following statements is true in respect of the liability of a partner?

‘The business of a partnership concern may be carried on by all the partners, or any of them acting for all.’ The above statement highlights which of the following features of partnership?

The commission due to a partner is closed by ______.

Which of the following is a right of a partner?

1. Sharing profits and losses with other partners in the agreed ratio.
2. Inspecting and having a copy of the books of accounts.
3. Retiring from the firm without giving proper notice.
4. Taking part in the conduct of the business.

Choose the correct option:

Abbay, Boris and Chetan were partners in a firm sharing profits in the ratio of 5 : 3 : 2. Boris was guaranteed a profit of ₹ 95,000. Any deficiency on account of this was to be borne by Abbay and Chetan equally. The firm earned a profit of ₹ 2,00,000 for the year ended 31st March, 2023. The amount given by Abbay to Boris as a guaranteed amount will be ______.

Ravi, Mohan and Vinod were partners in a firm sharing profits and losses in the ratio of 2 : 2: 1. The partnership deed provided that interest on partner's drawings will be charged @ 12% p.a. Starting from 1st July, 2023, Mohan withdrew ₹ 20,000 every month for his personal use. For the year ended 31st March, 2024 interest on Mohan's drawings will be charged for ______ months.

Manoj, Dilip and Rajinder were partners in a firm sharing profits and losses in the ratio of 7 : 3 : 5. Their fixed capitals were ₹ 10,00,000, ₹ 8,00,000 and ₹ 6,00,000, respectively. The partnership deed provided for interest on partner's drawings @ 12% p.a. Which of the following accounts will be debited for charging interest on partner's drawings?

Ganga and Triveni were partners with capitals of ₹ 2,00,000 and ₹ 4,00,000, respectively. Saraswati was admitted for a `1/4`th share in the profits. Saraswati was unable to bring her share of the goodwill premium in cash. The journal entry recorded for goodwill premium is given below:

The new profit-sharing ratio will be:

A and B are partners. The net divisible profit as per Profit and Loss Appropriation A/c is ₹ 2,50,000. The total interest on the partner’s drawings is ₹ 4,000. A’s salary is ₹ 4,000 per quarter, and B’s salary is ₹ 40,000 per annum. Net profit/loss earned during the year was ______.

A and B are partners sharing profits in 3 : 2 with capitals of ₹ 6,00,000 and ₹ 4,00,000, respectively. They are entitled to interest on their capitals @ 10% p.a., and A is also entitled to a rent of ₹ 10,000 per month for use of his property by the firm. Net Profit earned by the firm for the year ended 31st March 2020 was ₹ 3,00,000. B’s share of profit will be ______.

Pick the odd one out of the following:

1. Interest allowed on a loan taken by the firm from a partner.
2. Rent is due to a partner of the firm for using his premises for business purposes.
3. Salary due to the manager of the firm.
4. Transfer of General Reserve

X and Y are partners in the ratio of 2 : 1. Their capitals are ₹ 3,00,000 and ₹ 2,00,000, respectively. Interest on capitals is allowed @ 9% p.a. The firm earned a profit of ₹ 30,000 for the year ended 31st March 2024. Interest on Capital will be ______.

A and B were partners sharing profits in 2 : 1 ratio. During the year ended 31st March, 2024, A’s drawings were ₹ 10,000 per month drawn in the beginning of every month and B’s drawings were ₹ 10,000 per month drawn at the end of every month. After the preparation of final accounts, it was discovered that interest on drawings @ 12% p.a. was not taken into consideration. In the adjustment entry ______.

A, B and C were partners sharing profits in the ratio of 4 : 3 : 2. It was provided that B’s share of profit will not be less than ₹ 1,50,000 per annum. The losses for the year ended 31st March, 2024, were ₹ 80,000 before allowing interest on Loan of ₹ 2,00,000 taken from A on 1st June, 2023.

The share of each partner’s profit/loss will be:

Remuneration to the manager will be:

Interest on capital allowed to partners will be:

Shreya’s share of profit will be:

Pick the odd one out:

1. Salary to a partner
2. Rent to a partner
3. Commission to a partner
4. Interest on partner’s capital

A and B were partners in a firm sharing profits in the ratio of 2 : 1. The partnership deed provided interest on drawings @ 12% p.a. During the year:

1. A’s drawings were ₹ 5,000 per month in the beginning of every month.
2. B’s drawings were ₹ 10,000 per quarter.

Net profit for the year was distributed without charging interest on drawings. In the adjustment entry:

Chitra and Divya were partners in a firm. Their respective fixed capitals were ₹ 15,00,000 and ₹ 10,00,000. The partnership deed provided interest on drawings @ 6% p.a.

During the year ended 31-3-2024, Chitra’s drawings were ₹ 10,000 per month, drawn at the end of every month, and Divya’s drawings were ₹ 30,000 per quarter, drawn at the beginning of every quarter.

Net profits for the year were distributed without taking into consideration the interest on drawings.

In the adjusting entry:

The partners of a firm distributed the profits for the year ended 31st March, 2024, ₹ 90,000, in equal proportion without providing for the following adjustments:

1. A and B each were entitled to a salary of ₹ 1,500 per quarter.
2. C was entitled to a commission of ₹ 18,000.
3. Profits were to be shared in the ratio of 3 : 2 : 1.

In the adjustment entry:

A and B are partners with capitals of ₹ 3,00,000 and ₹ 2,00,000, respectively. As per the partnership deed:

1. Profits and losses are to be shared in the ratio of 2 : 1.
2. 10% of the distributable profit should be transferred to General Reserve.

For the year ending 31st March, 2024, B’s share of profit was ₹ 1,20,000.

The amount transferred to General Reserve will be:

A, B and C were partners sharing profits in the ratio of 1 : 2 : 3. A withdrew ₹ 10,000 every month, B withdrew ₹ 1,20,000 during the year and C withdrew ₹ 30,000 during each quarter. It was discovered that for the year ending 31st March 2024, interest on drawings was charged @ 7% p.a. whereas there is no provision for interest on drawings in the partnership deed. In the rectifying entry:

X and Y are partners with capitals of ₹ 4,00,000 and ₹ 2,00,000, respectively, on 1st April, 2023, and their profit sharing ratio is 3 : 2. Interest on capital is agreed @ 5% p.a. Y is to be allowed a salary of ₹ 5,000 p.m. The profit for the year ended 31st March, 2024, amounted to ₹ 1,54,000. The manager is entitled to a commission of 10% of the profits after charging such commission. Y’s share of profit will be ______.

1. Rashmi’s commission will be:
   1. ₹ 40,000
   2. ₹ 44,000
   3. ₹ 36,000
   4. ₹ 36,364
2. Rashmi’s share of profit will be:
   1. ₹ 1,80,000
   2. ₹ 1,44,000
   3. ₹ 2,16,000
   4. ₹ 1,60,000
3. In case there is no partnership agreement, which of the following is incorrect:
   1. Interest on the partner’s loan will be allowed at 6% p.a.
   2. No interest is to be charged on drawings made by the partners.
   3. Interest on the partner’s loan to the firm will not be allowed in case of loss in the firm.
   4. Even if the capitals of partners are unequal, profits and losses are to be shared equally.

Tripti and Khushi are partners sharing profits in the ratio of 3 : 2. Ruchi was a manager who received a quarterly salary of ₹ 20,000 in addition to a commission of 10% on net profits after charging such commission. Total remuneration to Ruchi amounted to ₹ 1,30,000. What was the profit for the year before charging salary and commission?

C and D contribute ₹ 5,00,000 and ₹ 3,00,000, respectively, in a partnership firm by way of capital, on which they agree to allow interest @ 6% p.a. Their profit or loss sharing ratio is 2 : 3. The profit at the end of the year was ₹ 16,000 before allowing interest on capital. If there is a clear agreement that interest on capital will be paid even in case of loss, then D’s share will be:

On 31st March, 2024, the balances in the capital accounts of Aditi and Chanda after making adjustments for profits and drawings were ₹ 4,00,000 and ₹ 2,50,000, respectively. Subsequently, it was discovered that the interest on capital had been omitted.

The profit for the year ended on 31st March, 2024, was ₹ 1,50,000.

During the year, Aditi and Chanda each withdrew ₹ 5,000 per month.

Interest on capital was to be allowed @ 10% per annum.

The profit-sharing ratio of partners was 2 : 1.

Interest on capital will be:

Y is a partner in a firm. He withdrew regularly ₹ 12,000 at the end of every month for six months ending 31st March, 2024. If interest on drawings is charged @ 10% p.a., the interest charged will be ______.

Nandi is a partner in a firm. He withdrew ₹ ......... per month in the middle of every month during the year ended 31st March, 2024. If interest on drawings is charged @ 8% p.a. and the interest charged is ₹ 1,920, then he withdrew how much amount per month?

Interest on drawings will amount to:

Share of profit will be:

Ravi’s Current Account Balance will be:

If the capital of a partner is ₹ 1,00,000 and his personal assets are ₹ 40,000 and personal liabilities are ₹ 10,000, the extent of his liability in the firm will be:

A, B and C are partners sharing profits in 3 : 2 : 1. C’s share of profits for the year ending 31st March 2024 amounts to ₹ 50,000. Interest allowed on the partner’s capital is ₹ 1,50,000, and A is allowed a salary of ₹ 5,000 per month. Interest charged on the partner’s drawings is ₹ 2,000. What was the net profit of the firm before any appropriations?

On 1st April, 2023, the capitals of Monika and Shreya were ₹ 4,00,000 and ₹ 2,00,000, respectively. They divided profits in the ratio of 3 : 2. Profits for the year ended 31st March, 2024, were ₹ 3,00,000, which have been duly distributed among the partners, but the following transactions were not passed through the books:

1. Interest on capitals @ 8% p.a.
2. Interest on drawings of Monika ₹ 8,000.
3. Monika is to be paid a salary of ₹ 15,000 per quarter.

In the adjustment entry:

Rani and Sakhi are partners with capitals of ₹ 4,00,000 and ₹ 1,00,000, respectively. They are entitled to interest on their capitals @ 10% p.a. In addition, Rani is entitled to a salary of ₹ 4,000 per month, and Sakhi is entitled to rent of ₹ 5,000 per month for use of her office by the firm. Net profit for the year was ₹ 2,00,000. Rani’s share of profit will be ______.

Esha, Kavya and Ruchi were partners sharing profits in the ratio of 2 : 2 : 1. Esha withdrew ₹ 5,000 every month, and Kavya withdrew ₹ 7,500 every month. Interest on drawings @ 6% p.a. was charged, whereas the partnership deed was silent about interest on drawings.

In the adjustment entry:

A, B and C were partners in the ratio of 3 : 2 : 1. Their capitals were ₹ 5,00,000; ₹ 4,00,000 and ₹ 3,00,000, respectively, and as per the partnership deed, they were entitled to 10% p.a. interest on their capitals. On 31st March 2024, their books reflected a net profit of ₹ 1,20,000. As per partnership deed a salary of ₹ 30,000 each was payable to A and B.

Calculate the ratio in which the profits would be appropriated.

Geeta and Parul are partners in a firm. As per partnership deed interest on drawings is to be charged @ 4% p.a. Parul withdrew ₹ 5,000 per month at the end of each month for the first six months of the year. Accounts are closed on 31st March, 2024. Interest on drawings will be ______.

A, B, C and D are partners. A and B share `3/4`th of profits in the ratio of 2 : 1 and C and D share the remaining profits equally. Profit sharing ratios will be ______.

Arti and Bina are partners with profit sharing ratio of 2 : 1 and capitals of ₹ 5,00,000 and ₹ 4,00,000, respectively. They are allowed 8% p.a. interest on their capitals and are charged 10% p.a. interest on their drawings. Their drawings during the year were Arti ₹ 80,000 and Bina ₹ 60,000. Arti’s share of net profit as per the profit and loss appropriation account amounted to ₹ 1,00,000. Net profit of the firm before any appropriations was ______.

Read the following hypothetical situation and answer the following questions:

1. The amount to be reflected in blank (1) will be:
   1. ₹ 37,200
   2. ₹ 44,700
   3. ₹ 22,800
   4. ₹ 20,940
2. The amount to be reflected in blank (2) will be:
   1. ₹ 62,000
   2. ₹ 74,500
   3. ₹ 71,400
   4. ₹ 70,775

Shyam, Gopal and Arjun are partners carrying on a garment business. Shyam withdrew ₹ 10,000 in the beginning of each quarter. Gopal withdrew garments amounting to ₹ 15,000 to distribute it to flood victims, and Arjun withdrew ₹ 20,000 from his capital account. The partnership deed provides for interest on drawings @ 10% p.a. The interest on the drawing charged from Shyam, Gopal and Arjun at the end of the year will be:

Edward and Hayward are partners. Edward draws a fixed amount at the beginning of every quarter. Interest on drawings is charged @ 10% p.a. At the end of the year, interest on Edward’s drawings amounted to ₹ 7,500. Drawings of Edward were ______.

Ayan, Azan and Aqib are partners carrying on a furniture business.

Ayan withdrew ₹ 5,000 at the end of each month.

Azan withdrew ₹ 10,000 at end of each quarter.

Aqib withdrew ₹ 40,000 at the end of each month for the last six months of the year. The partnership deed provides for interest on drawings @ 12% p.a. The interest on drawing charged from Ayan, Azan and Aqib at the end of the year will be:

Ikka, Dukka and Teeka were partners sharing profits and losses in the ratio of 2 : 2 : 1. Their fixed capital balances were ₹ 5,00,000; ₹ 4,00,000 and ₹ 3,00,000 respectively. For the year ended March 31, 2024, profits of ₹ 84,000 were distributed without providing for interest on capital @ 10% p.a. as per the partnership deed.

While passing an adjustment entry, which of the following is correct?

Arjun and Bhim were partners in a firm sharing profits in the ratio 3 : 2. On 31st March 2023, their capitals were ₹ 1,29,000 and ₹ 1,08,000, respectively. Divisible Profit for the year ended 31st March 2023 was ₹ 50,000. Interest on capital was also provided @ 10% p.a. in accordance with the partnership deed. Determine interest on Arjun’s Capital for the year ended. 31.03.2023.

Assertion (A): Partnership is the result of an agreement between two or more persons to do business and share its profits and losses.

Reason (R): Partnership agreement should always be in writtem form.

Choose the correct option from the following:

Assertion (A): Each partner carrying on the business of the firm is the principal as well as the agent for all the other partners of the firm.

Reason (R): There exists a relationship of mutual agency between all the partners.

Choose the correct option from the following:

Assertion (A): A partnership firm can have maximum 50 partners.

Reason (R): Maximum limit of partners is prescribed in the Partnership Act, 1932.

In the context of the above two statements, which of the following is correct?

Assertion (A): Partners are principals but not the agents of other partners.

Reason (R): Partners are principals as well as agents of other partners.

In the context of the above two statements, which of the following is correct?

Assertion (A): When the profit-sharing ratio is agreed upon among the partners, they will share the losses also in the same ratio.

Reason (R): Although in the definition of partnership given in the Partnership Act it is stated that profits will be shared, profits include losses also.

In the context of the above two statements, which of the following is correct?

Assertion (A): A minor cannot be admitted in a firm as a partner.

Reason (R): A minor can participate in the profits of a firm.

In the context of the above two statements, which of the following is correct?

Assertion (A): When a clause in a partnership deed differs from provisions of the Partnership Act 1932, the clause in the partnership deed will be applicable.

Reason (R): Provisions of the Partnership Act 1932 will be applicable only when partners have not agreed on a matter.

In the context of the above two statements, which of the following is correct?

Assertion (A): Partnership may be conducted on the basis of written or oral agreement, and all partners should contribute capital in the firm.

Reason (R): It is necessary that a written agreement exists and the business may be conducted on by all or any of them acting for all.

In the context of the above two statements, which of the following is correct?

Assertion (A): Priti, Riya and Sarita are partners. As per partnership deed Priti is to be allowed a salary of ₹ 8,000 per month. Riya and Sarita also demand the same salary. Salaries to Riya and Sarita is to be allowed.

Reason (R): In the absence of mention of salaries to Riya and Sarita in the partnership deed, salaries to Riya and Sarita are not to be allowed.

In the context of the above two statements, which of the following is correct?

Assertion (A): Rent payable to a partner is debited to Profit and Loss Account and not debited to the Profit and Loss Appropriation Account.

Reason (R): Rent payable to a partner is a charge against profits and not an appropriation of profit. Hence, it is debited to Profit and Loss Account.

In the context of the above two statements, which of the following is correct?

Assertion (A): A, B and C were partners in a firm. Partner B gave a loan of ₹ 10,00,000 to the firm without an agreement as to the rate of interest. At the year end, all partners agreed to allow interest on the loan by B @ 9% p.a.

Reason (R): In the absence of Partnership Deed provisions of the Partnership Act, 1932 apply. Thus, interest on a loan by B should be allowed @ 6% p.a. and not @ 9% p.a.

In the context of the above two statements, which of the following is correct?

Assertion (A): In case the amount of drawings is not the same or if drawings are made on different dates, interest on drawings will be calculated using the product method.

Reason (R): In such a case, interest on drawings is charged for the period it is drawn by a partner. As such, the average method cannot be used to ascertain the amount of interest on drawings.

In the context of the above two statements, which of the following is correct?

Assertion (A): A and B are partners in a firm. As per partnership deed interest on drawings is to be charged @ 9% p.a. A withdrew ₹ 10,000 per month at the end of each month, and B withdrew ₹ 10,000 per quarter at the end of each quarter. The firm incurred a loss of ₹ 2,00,000. Hence, interest will not be charged on drawings.

Reason (R): Interest on drawings will be charged @ 9% p.a. on ₹ 1,20,000 from A for 5.5 months and from B for 4.5 months.

In the context of the above two statements, which of the following is correct?

Assertion (A): In the case of a partnership firm, appropriation out of profits are debited to the Profit and Loss Appropriation Account.

Reason (R): Interest on capital and partner’s salary are appropriation of profit.

In the context of the above two statements, which of the following is correct?

Assertion (A): Transfer to reserves is shown in the Profit and Loss Appropriation A/c.

Reason (R): Reserves are charge against the profits.

In the context of the above two statements, which of the following is correct?

Assertion (A): In a specified situation, interest on a partner’s capital is written in the Profit and Loss Account.

Reason (R): Interest on a partner’s capital is written on the debit side of the profit and Loss Account if it is specified to be a charge against profits.

In the context of the above two statements, which of the following is correct?

Assertion (A): The fixed capital account balance of a partner may change due to additional capital introduced or capital withdrawn or both during the year.

Reason (R): Under the fixed capital method, the partner’s capital accounts balance always remains the same.

In the context of the above two statements, which of the following is correct?

Assertion (A): Co-ownership of property amounts to partnership.

Reason (R): The element of business is present in co-ownership.

In the context of the above two statements, which of the following is correct?

Assertion (A): In order to form a partnership, there should be at least two persons coming together for a common goal. The maximum number of partners is 50 (fifty) as prescribed by the Central Government.

Reason (R): As per Sec. 464 of the Companies Act 2013, the Central Government is empowered to prescribe a maximum number of partners, but the maximum number of partners cannot exceed 100. The central government has prescribed the maximum number of partners to be 50.

In light of the above statements, choose the most appropriate answer from the options given below:

Assertion (A): Commission provided to the partner is shown in the Profit and Loss A/c.

Reason (R): Commission provided to the partner is charge against profits and is to be provided at a fixed rate.

Assertion (A): Partnership is the relation between persons who have agreed to share the profits of the business carried on by all or any of them acting for all.

Reason (R): If a partner carries on any business of the same nature and competing with that of the firm, he/she shall account for and pay to the firm all profit made by him/her in that business.

Choose the correct option from the following:

Assertion (A): Michael, Mike and Stephen were partners sharing profits and losses in the ratio 3 : 2 : 1. Stephen, being a partner, wants that he should be exempted from sharing the losses in the firm.

Reasoning (R): According to the Partnership Act 1932, “It may be agreed between the partners that one or more of them shall not be liable for losses.”

Assertion (A): Each partner is a principal as well as an agent for all the other partners.

Reason (R): As per the definition of the Partnership Act, partnership business may be carried on by all the partners or any of them acting for all.

Choose the correct alternative from the following:

Assertion: A partnership firm is said to maintain its accounts by the fixed capital account method when it has a separate capital account and current account for every partner.

Reason: A fixed capital account method is maintained to ensure that the balance in the current account of any partner is not overdrawn at any point of time.

Which one of the following is correct?

Assertion (A): Private assets of a partner can also be used for paying off the firm's debts.

Reason (R): Liability of a partner for acts of the firm is limited.

Choose the correct alternative from the following: