HOLIDAY HOMEWORK

CLASS : 12
SUBJECT : Accountancy
,
1)Chapter 1 : Accounting for partnership Fundamentals
●Solve case based mcq 1 to 7
● solve additional question 78 to 118
●Solve Assertion reason based and mcq question of back exercise
2)Chapter 2
●Solve case based mcq 1 to 3
●Solve Assertion reason based and mcq question of back exercise
Above mentioned homework should be solved in your Fair notebook
 Assignment-1
Fundamentals of partnership Firms
1. Below are listed Content of partnership Deed except:
a. Ratio in which profit or losses shall be share
b. Interest on Partners capital and drawings
c. Interest on Debentures
d. Name of the firm.
2. Which Section of the Partnership Act defines Partnership as the relation between persons who have agreed to
share the profits of a business carried on by all or any of them acting for all?
a. Section 61
b. Section 48
c. Section 13
d. Section 4
3. From the following, what is important for a partnership?
a. More than 10 Persons
b. Registration
c. Sharing of Profits
d. Capital more than 15 Crore
4. Interest on capital as a charge against profits in case of insufficient profit is
a. Not allowed
b. Allowed to the extent of profit
c. Allowed in full irrespective of profit
d. All of these
5. From the following, identify a situation when fixed capitals of the partners may change?
a. When drawings are made by the partners
b. When current accounts are opened
c. When there is loss in the business
d. When additional capital is introduced
6. Fill in the blanks: Manager's commission is a ________ against profits.
7. The net profit of X, Y and Z for the year ended March 31, 2016, was Rs 60,000 and the same was distributed
among them in their agreed ratio of 3 : 1 : 1. It was subsequently discovered that the undermentioned
transactions were not recorded in the books :
(i) Interest on Capital @ 5% p.a.
(ii) Interest on drawings amounting to X Rs 700, Y Rs 500 and Z Rs 300.
(iii) Partner’s Salary : X Rs 1000, Y Rs 1500 p.a.
The capital accounts of partners were fixed as : X Rs 1,00,000, Y Rs 80,000 and Z Rs 60,000. Record the
adjustment entry.
8. Amann, Babita and Suresh are partners in a firm. Their profit sharing ratio is 2:2:1. Suresh is guaranteed a
minimum amount of Rs 10,000 as share of profit, every year. Any deficiency on that account shall be met by
Babita. The profits for two years ending December 31, 2016, and December 31, 2017, were Rs 40,000 and Rs
60,000, respectively. Prepare the Profit and Loss Appropriation Account for the two years.
9. Amit, Babita and Sona form a partnership firm, sharing profits in the ratio of 3:2:1, subject to the following:
i. Sona’s share in the profits, guaranteed to be not less than Rs 15,000 in any year.
ii. Babita gives guarantee to the effect that gross fee earned by her for the firm shall be equal to her
average gross fee of the proceeding five years, when she was carrying on profession alone (which is Rs
25,000). The net profit for the year ended March 31, 2017, is Rs 75,000. The gross fee earned by Babita
for the firm was Rs 16,000.
You are required to show Profit and Loss Appropriation Account (after giving effect to the alone)
10. P and Q are partners with capitals of Rs.6,00,000 and Rs.4,00,000 respectively. The profit and Loss Account
of the firm showed a net Profit of Rs.4,26,800 for the year.
Prepare Profit and Loss Appropriation account after taking the following into consideration:-
i. Interest on P's Loan of Rs. 2,00,000 to the firm
 ii. Interest on capital to be allowed @ 6% p.a.
iii. Interest on Drawings @ 8% p.a. Drawings were ; P Rs 80,000 and Q Rs. 50,000.
iv. Q is to be allowed a commission on sales @ 3%. Sales for the year was Rs. 10,00,000
v. 10% of the divisible profits is to be kept in a Reserve Account.
11. Mohan, Neeraj and Peeyush are partners in a firm. They contributed Rs 75,000 each as capital three years
ago. At that time, Peeyush agreed to look after the business as Mohan and Neeraj were busy. The profits for the
past three years were Rs 45,000, Rs 30,000 and Rs 60,000 respectively. While going through the books of
accounts, Mohan noticed that profit had been distributed in 1: 1: 2 ratio. When he enquired from
Peeyush about this, Peeyush answered that since he looked after the business he should get more profit. Mohan
disagreed and it was decided to distribute profits equally retrospectively for the last three years.
You are required to make necessary corrections in the books of accounts of Mohan, Neeraj and Peeyush by
passing an adjustment entry.
12. Mona, Nisha and Priyanka are partners in a firm. They contributed Rs 50,000 each as capital three years
ago. At that time, Priyanka agreed to look after the business as Mona and Nisha were busy. The profits for the
past three years were Rs 15,000, Rs 25,000 and Rs 50,000 respectively. While going through the books of
accounts, Mona noticed that the profit had been distributed in the ratio of 1: 1: 2. When she enquired from
Priyanka about this, Priyanka answered that since she looked after the business she should get more profit.
Mona disagreed and it was decided to distribute profit equally retrospectively for the last three years.
You are required to make necessary correction in the books of accounts of Mona, Nisha and Priyanka by
passing an adjustment entry.
13. S and P are partners in a firm sharing profits and losses equally. On 1st April, 2011, the capitals of the
partners were, S Rs 20,000 and P Rs 16,000. The profit and loss account of the firm showed a net profit of
37,500 (before interest on P’s loan) for the year ended 31st March, 2012. Considering the following
information, prepare the profit and loss appropriation account of the firm and the partners’ capital account:
i. Interest on capital to be allowed @ 6% p.a.
ii. Interest on P’s loan account of Rs 10,000 for the whole year.
iii. Interest on drawings of partners @ 6% p.a. Drawings being S Rs 4,000 and P Rs 3,000.
iv. Transfer 10% of the distributable profits of the reserve.
14. L, M, and N were partners in firm sharing profit in the ratio of 3:4:5. Their fixed capitals were L Rs
4,00,000 , M Rs 5,00,000 and N Rs 6,00,000 respectively. The partnership deed provided for the following:
i. Interest on capital @ 6% p.a.
ii. Salary of Rs 30,000 p.a. to N.
iii. Interest on partner’s drawings will be charged @ 12% p.a.
During the year ended 31.3.2009, the firm earned a profit of Rs 2,70,000. L withdrew Rs 10,000 on 1.4.2008. M
withdrew Rs 12,000 on 30.09.2008 and N withdrew Rs 15,000 on 31.12.2008. Prepare profit and loss
appropriation account for the year ended 31.3.2009.
Assignment-2
Goodwill - Nature and Valuation
1. As per Accounting Standard-26:
a. both purchased and self-generated goodwill are accounted in the books of account
b. purchased goodwill is accounted in the books of account
c. self-generated goodwill is accounted in the books of account
d. None of these
2. Calculate the average profit of last four year's profits. The profits of the last four years were:
2008-27000; 2009-39000; 2010-16000(loss); 2011-40000
a. Rs.10000
b. Rs. 22500
c. Rs. 30000
d. Rs. 40000
3. The excess amount which the firm gets on selling its business over and above the net value is
a. Surplus
b. Goodwill
 c. Super profits.
d. Reserve
4. Goodwill is valued
a. at the time of change in profit-sharing ratio
b. at the time of retirement or death of a partner
c. at the time of admission of a partner
d. All of these
5. Goodwill under Average Profit Method means
a. None of these
b. Normal profit Number of year's purchase
c. Super profit Number of year's purchase
d. Average profit Number of year's purchase
6. Fill in the blanks: Average Profit = ________.
7. How does goodwill arise?
8. How does the factor ‘quality of product' affect the goodwill of a firm?
9. The profits and losses for last five years were:
1st year - Rs 3,000 (including an abnormal gain of 1,000)
2nd year - Rs 7,000 (excluding Rs 2,000 as insurance premium)
3rd year - Rs 2,000 (after charging an abnormal loss of Rs 1,000)
4th year - Rs 3,000
5th year - Rs 1,000 (Loss)
Calculate the amount of Goodwill on the basis of 3 years purchase of last 5 years profits and losses.
10. A business has earned average profits of Rs 1,00,000 during the last few years and the normal rate of return
in a similar business is 10%. Find out the value of goodwill by:
i. Capitalisation of super profit method.
ii. Super profit method, if the goodwill is valued at 3 years’ purchase of super profit.
The assets of the business were Rs 10,00,000 and its external liabilities Rs 1,80,000.
11. Neeraj and Dheeraj are carrying on a business of repairing electronic items. There are no other technicians
for repairing electronic items in the locality. As the electric supply has a lot of fluctuations the equipments get
damaged. Therefore, both the partners themselves do the repairing work to the satisfaction of the customers.
The firm donates 10% of its profits to a Charitable Hospital of the locality for the medical treatment of persons
below poverty line. State the two factors affecting the goodwill of the firm discussed in the above para.
12. Cake and Muffin are partners sharing profits and losses in the ratio of 5: 4. On 1st April 2016, they admit
Cookie as a new partner for th share in the profits of the firm and the new ratio agreed upon is 3:2:1.
Goodwill, at the time of Cookie's admission, is to be valued on the basis of capitalization of the average profits
of the last three years. Profits for the last three years were:
Year ended 31st March 2014 ₹39,000 (including an abnormal loss of ₹9,000)
Year ended 31st March 2015 ₹83,000 (including an abnormal loss of ₹8,000)
Year ended 31st March 2016 ₹72,000
On 1st April 2016, the firm had assets of ₹8,00,000. Its creditors amounted ₹3,60,000. The firm had a Reserve
Fund of ₹40,000 while Partners' Capital Account showed a balance of ₹4,00,000. The normal rate of return
expected form this class of business is 13%.
Cookie brings in ₹2,00,000 for her capital but is unable to bring in cash for her share of goodwill.
You are required to calculate Cookie's share of Goodwill in the firm (Show your workings clearly).