Topic: Accounts Standard: 12th CBSE

Total Time: 1.5-hour Date: Total Marks: 40

1. Calculate interest on drawings of Mr. A @ 10% p.a. from the following information: 1
01.04.2022 Drawings 5,000
30.06.2020 Drawings 6,000
31.08.2020 Withdrawal of capital 10,000
01.12.2020 Drawings 1,500
Interest on drawings on 31st March 2021 will be:
(a) 1200 (b) 1583 (c) 1683 (d) 1000
2. P and Q are partners sharing Profits in the ratio of 2:1 with fixed capitals of ₹10,00,000 and ₹5,00,000 1
respectively. After closing the accounts for the year ending 31st March 2022 it was discovered that
interest on Drawings was Charged from P is Rs.600 but partnership deed is silent on interest on
Drawings. In the adjusting entry, Q's Current Account will be:
(a) Credited with 200 (b) Debited with 200
(c) Neither debited nor credited because there is on drawings of Q
(d) Credited with 400
3. A, B and C are partners in a firm sharing Profits and loss in the ratio of 5:3:2, they decided to share 1
profits and losses in the ratio of 1:1:1 w.e.f. 01.04.2021. Investment fluctuation reserve as on that date
was ₹30,000 and the current investment is ₹2,00,000
(i) No other information is given (cost and market (A) A = 5000(Cr.); B = 3,000 (Cr.); C = 2,000 (Cr.)
value are same)
(ii) Investment revalued at ₹1,80,000. (B) A = 10,000 (Dr.); B = 6,000 (Dr.); C = 4,000(Dr.)
(iii) Investment revalued at ₹1,60,000. (C) A = 5,000 (Dr.); B = 3,000 (Dr.); C = 2,000 (Dr.)
(iv) Investment revalued at ₹1,50,000. (D) A = 15,000 (Cr.); B = 9,000 (Cr.); C = 6,000 (Cr.)
(a) (i) – C; (ii) – A; (iii) – D; (iv) – B (b) (i) – C; (ii) – A; (iii) – D; (iv) – B
(c) (i) – D; (ii) – A; (iii) – C; (iv) – B (d) (i) – C; (ii) – A; (iii) – B; (iv) – D
4. X, Y and Z are partners sharing profits in the ratio of 3:2:1. X has given guarantee to Z for a minimum 1
share of profit for the year. After meeting Z’s deficiency of 40,000, X gets his share of final net profit
₹1,10,000. What was the guaranteed amount of Z?
(a) 1,50,000 (b) 1,00,000 (c) 50,000 (d) 90,000
5. X and Y are partners in a firm. X is to get a commission of 10% of net profit before charging any 1
commission. Y is to get a commission of 10% on net profit after charging all commissions. Net profit
before charging any Commission was ₹55,000. Commission of Y will be:
(a) 5,500 (b) 5,000 (c) 4,500 (d) 4,950
Question no.’s 6, 7 and 8 are based on the hypothetical situation given below.
X and Y are sharing profits in the ratio of 5:4. They admit Z. as a new partner for 1/6th share in the profits. New
ratio agreed upon is 3:2:1. Z bring ₹2,00,000 as capital but unable to bring premium for goodwill in cash. At the
time of admission of Z, Goodwill to be valued by Capitalization of average profit of last 3 years.
At the year ending 31st March 2019 Profit ₹39,000 (including abnormal loss of ₹9,000)
At the year ending 31st March 2020 Profit ₹83,000 (including abnormal gain of ₹8,000)
At the year ending 31st March 2021 Profit ₹72,000
On 1st April 2021, the firm has assets of ₹8,00,000, Creditors ₹3,60,000, General Reserve ₹40,000, Partners
Capital Accounts Balance ₹4,00,000. Normal rate of return expected 13% from this type of business.
6. Average Adjusted Profit will be: 1
(a) 62,333 (b) 62,000 (c) 63,000 (d) 65,000
7. Capitalized value of average profit: 1
(a) 65,000 (b) 6,50,000 (c) 5,00,000 (d) 8,450

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 8. Z’s Share of goodwill: 1
(a) 40,000 (b) 30,000 (c) 20,000 (d) 10,000
9. X, Y and Z are partners sharing profits in the ratio of 3: 2: 1. They decided to share future profits in the 1
ratio 2: 1: 1. Thus, Z’s sacrifice/gain will be:
(a) 3/12 gain (b) 4/12 gain (c) 1/12 gain (d) sacrifice 1/12
10. Arun and Vijay are partners in a firm sharing profits and losses in the ratio of 5:1. 1
Balance Sheet (Extract)
Liabilities Amount Assets Amount
Machinery 40,000
1/3
If the value of machinery reflected in the balance sheet is overvalued by 33 %, find out the value of
Machinery to be shown in the new Balance Sheet:
(a) ₹ 53,200 (b) ₹ 53,333 (c) ₹ 32,000 (d) ₹ 30,000
11. In case of Fixed Capital, Interest on Partner’s Loan is credited to his. 1
(a) Capital Account (b) Current Account
(c) Either Capital Account or Current Account (d) None of these
12. Amit and Sumit are partners in a firm with following balances in their capital and current accounts: 1
Capital A/cs Current A/cs
Amin 3,00,000 60,000
Sumit 2,00,000 10,000 (Dr.)
The profit earned by the firm for the year ending 31st March, 2020 was ₹80,000. Find the value of
goodwill of the firm if normal rate of return is 10%.
(a) ₹2,40,000 (b) ₹2,50,000 (c) ₹25,000 (d) ₹24,000
13. Assertion (A): If a partner of a firm is guaranteed by another partner for minimum guaranteed profit, he 1
is entitled to it even if the firm incurs loss.
Reason (R): Guaranteed profit is given only when firm earns profit.
Select the correct option:
(a) Both A and R are true and R is the correct explanation of A.
(b) Both A and R is true but R is not correct explanation of A.
(c) A is true but R is false. (d) A is false but R is true.
14. X, Y and Z are partners sharing profits and losses in ratio of 3:2:1. They decided to share profits equally 1
in future. On this date, there was a debit balance of ₹ 30,000 in the Profit and Loss A/c. Which entry be
passed if they do not wish to alter the value of Profit and Loss (Dr.) from the books of accounts.
(a) Dr. X's A/c and Cr. Z's A/c ₹ 5,000 (b) Dr. Z's A/c and Cr. X's A/c ₹ 5,000
(c) Dr. Y's A/c and Cr. Z's A/c ₹ 5,000
(d) Dr. X, Y, Z (1:1:1) and Cr. Profit and Loss A/c ₹ 30,000
15. Radhika, Bani and Chitra were partners in a firm sharing profits and losses in the ratio of 2:3:1. With effect 3
1st April, 2018, they decided to share future profits and losses in the ratio of 3:2:1. On that date their
Balance Sheet showed a debit balance of Rs. 24,000 in Profit & Loss Account and a balance of Rs. 1,44,000
in General Reserve. It was also agreed that:
(a) The goodwill of the firm be valued at Rs. 1,80,000
(b) The Land (having book value of Rs. 3,00,000) will be valued at Rs. 4,80,000.
Pass the necessary Journal entries for the above changes.
16. Madhu and Vidhi are partners sharing profits in the ratio of 3: 2. They decided to admit Manu as a partner 3
from 1st April, 2021 on the following terms:
(i) Manu will be given 2/5th share of the profit.
(ii) Goodwill of the firm will be valued at two years' purchase of three years' normal average profit of the
firm. Profits of the previous three years ended 31st March, were:
2021-Profit Rs.30,000 (after debiting loss of stock by fire Rs. 40,000).
2020-Loss Rs.80,000 (includes voluntary retirement compensation paid Rs.1,10,000).

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 2019-Profit Rs.1, 10,000 (including a gain (profit) of Rs.30,000 on the sale of fixed assets). Calculate the
value of goodwill
17. Compute goodwill of a firm on the basis of 3 years' purchase of the weighted average profits of last 4 years. 4
The profit of the last 4 years was:
31.3.2013 Rs.25,000, 31.3.2014 – Rs.30,000, 31.3.2015 – Rs.24,000 and 31.3.2016 – Rs.38,000.
The weights assigned were 1, 2, 3 and 4. Following information is supplied to you:
(a)In 2015, a major repair was made in plant incurring Rs.10,000 on 1st July which was charged to revenue.
The said sum is agreed to be capitalised for goodwill computation subject to depreciation@ 10% p.a. on
reducing balance method.
(b)The closing stock of 2014 was over valued by Rs.3,000.
18. On 31st March, 2014, the balances in the Capital Accounts of Saroj, Mahinder and Umar after making 4
adjustments for profits and drawings, etc... were Rs. 80,000, Rs. 60,000 and Rs. 40,000 respectively.
Subsequently, it was discovered that the interest on capital and drawings has been omitted.
(a) The profit for the year ended 31st March, 2014 was Rs. 80,000.
(b) During the year Saroj and Mahinder each withdrew a sum of Rs. 24,000 in equal instalments in the end
of each month and Umar withdrew Rs.36,000.
(c) The interest on drawings was to be charged @ 5% p.a. and interest on capital was to be allowed @10%
p.a.
(d) The profit-sharing ratio among partners was 4: 3: 1.
Showing your workings clearly, pass the necessary rectifying entry.
19. Amit and Sumit are partners with a capital of Rs. 2,00,000 and Rs. 1,50,000 respectively. The net 6
profit for the year ending 31st March,2017 amounted to Rs. 2,51,750 before considering the
followings:
(i) Amit advanced a loan to the firm amounting Rs. 1,00,000 on 1st April,2016.
(ii) Interest on capital be allowed @5% p.a.
(iii) Interest on drawing be allowed @5% p.a. Drawings of Amit was Rs. 40,000 and of Sumit was Rs.
30,000.
(iv) Amit was allowed a commission @ 2% on sales which was Rs. 15,00,000 while Sumit was allowed C
ommission @10% on distributable profit before charging his commission but after charging Amit’s
commission.
(v) It was also decided to keep 10% of divisible profit (before charging reserve) to Reserve Account.
Prepare Profit and LossAppropriation Account.
20. Ali, Bimal and Deepak are partners in a firm. On 1st April,2011 their capital accounts stood as Rs. 6
4,00,000 Rs. 3,00,000 and Rs. 2,00,000 respectively. They shared profit and losses in the ratio of
5:3:2. Partners are entitled to interest on capital @ 10% p.a. and salary to Bimal and Deepak @ Rs.
2,000 p.m. and Rs. 3,000 per quarter respectively as per provisions of the partnership deed.
Bimal’s share of profit (excluding interest on capital but including salary) is guaranteed at a
minimum of Rs. 50,000 p.a. Any deficiency arising on that account shall be met by Deepak. The
profits of the firm for the year ended 31st March,2012 amounted Rs. 2,00,000.
Prepare Profit and Loss Appropriation Account for the year ended 31st March,2012.

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