{ Accountancy }

Q1. A and B entered into a partnership on 1st April 2016 without any partnership
deed. They introduced capitals of ₹5,00,000 and ₹3,00,000 . On 31 st October 2016, A
advanced ₹2,00,000 by way of loan to the firm without any agreement as to interest.
The profit and loss account for the year ended 31 march 2017 showed a profit of
₹4,30,000 but the partner could not agree upon the amount of interest on loan to be
charged and the basis of division of profit between the partner and prepare the capital
account of the both the partner and loan account of ‘A’ .

[4 marks]

Q2. A,B and C are partners. Their capital were 30000 , 20000 , 10000 respectively.
According to the partnership deed, they were entitled to an interest on capital @ 5%
p.a . In addition , B was also entitled to draw a salary of ₹ 500 per month . C was
entitled to a commission @ 5 % p.a on the profit after charging the interest on capital
nut before the charging the salary payable to B. The met profit for the year were
₹30000 distributed in the ratio of their capital without providing for any of the above
adjustment. The profit were do be shared in the ratio of 2:2:1 . Pass necessary journal
entry and showing (working clearly).

[4 marks]

Q3. On 31st March, 2014 the balances in the Capital Accounts of Eleen, Monu and
Ahmad after making adjustments for profits and drawings were ₹1,60,000, ₹1,20,000
and ₹80,000 respectively. Subsequently, it was discovered that the interest on capital
and drawings had been omitted.

(i) The profit for the year ended 31st March, 2014 was ₹40,000.
(ii) During the year, Eleen and Monu each withdrew a total sum of ₹24,000 in
equal instalments in the beginning of each month and Ahmad withdrew a
total sum of 48,000 in equal instalments at the end of each month.
(iii) The interest on drawings was to be charged @5% p.a. and interest on capital
was to be allowed @10% p.a.

( iv) The profit-sharing ratio among the partners was 2:1:1.

Showing your working notes clearly, pass the necessary rectifying entry.

[6 Marks]

Q 4. Ahmad, Bheem and Daniel are partners in a firm. On 1 st April, 2011 the balance
in their capital accounts stood at ₹8,00,000, ₹6,00,000 and ₹4,00,000 respectively.
They shared profits in the proportion of 5:3:2 respectively. Partners are entitled to
interest on capital @5% per annum and salary to Bheem @ ₹3,000 per month and a
commission of 12,000 to Daniel as per the provisions of the partnership deed.

Ahmad’s share of profit, excluding interest on capital, is guaranteed at not less than
₹25,000 p.a. Bheem’s share of profit, including interest on capital but excluding
salary, is guaranteed at not less than 55,000 p.a. Any deficiency arising on that
account shall be met by Daniel. The profit of the firm for the year ended 31 st March,
2012 amounted to 2,16,000. Prepare ‘Profit and Loss Appropriation Account’ for the
year ended 31st March, 2012.

[6 Marks]

Q 5. Sahil, Babita and Vishal are partners in a firm sharing profits and losses in the
ratio of 5:4:2. On 1st April, 2019, they decided to share profits in future in the ratio of
4:3: 2. On this date, General Reserve was ₹34,900 and loss on revaluation of assets
and liabilities was 25,200. It was decided that adjustment should be made without
altering the figures of assets and liabilities in the Balance Sheet. Make adjustment by
passing a single journal entry.

[3
marks ]

Q6. The average net profits expected to a firm in future are ₹68,000 per year and
capital invested in the business by the firm is ₹3,50,000. The rate of interest expected
from capital invested in this class of business is 12%. The remuneration of the
partners is estimated to be ₹8,000 for the year. You are required to find out the value
of goodwill on the basis of two years’ purchase of super profit.

[ 3Marks ]

Q7. A, B and C were partner in the firm sharing profit in the ratio 2:2:1 There balance
sheet as on 31st March 2019 as at follow:

From April 1, 2019 the partners decided to share profits in the ratio of 1:2:3. For this
purpose, it was agreed that:

(i)The goodwill of the firm should be valued at ₹60,000.

(ii) Land should be revalued at ₹1,00,000. Building should be depreciated by 6%

(iii)Creditors amounting to 73,000 were not to be paid.

It was decided among the partners that General Reserve has to be distributed among
the partners whereas goodwill and revised values of assets and liabilities are not be
recorded You are required to:

(i) Record the necessary journal entries to give effect to the above
agreement.
(ii) Prepare the capital accounts of the partners
(iii) Prepare the Balance Sheet of the reconstituted firm. [6
marks]

Q8. Ashok, Bhim and Chetan were partners in a firm sharing profits in the ratio of
3:2:1. Their Balance Sheet as on 31st March, 2015 was as follows:

Ashok, Bhim and Chetan decided to share the future profits equally, w.e.f. 1 st April,
2015. For this it was agreed that:

(i) Goodwill of the firm be valued at ₹3,00,000.

(ii) Land be revalued at 1,60,000 and building be depreciated by 6%.
(iii) Creditors of ₹12,000 were not likely to be claimed and hence be written off.

Prepare Revaluation Account, Partners’ Capital Accounts and Balance Sheet of the
reconstitutedbe claimed and hence be written off.

[Multiple choice questions] 1 marks each

Q1. The maximum number of person in case of partnership firm as specified by

company act 2013 is –

(a) 20 (b). 30. (c) 100. (d). 50

Q2. Calculate the manager commission if profit is 66000 and commission is allowed
at @10% after such commission
 (a) 6600. (b). 5500. (c). 6000. (d) 5000

Q3. Current A/c of a partner

(a) Will always have a Cr. Balance

(b)Will always have a Dr. Balance
(c) Can never have a Dr. Balance
(d)May have a Dr. Or Cr.

Q4. Rent given to a partner:

(a) Is charge on profits

(b)Is share of partner profits
(c) Is an appropriate of profit
(d)All of these

Q5. B drew ₹8000 at the end of every month for 9 month ending 31 st march 2019.
Calculate interest on drawing if rate of interest is @10% p.a

(a) ₹3000
(b)₹3500
(c) ₹2400
(d)₹2700

Q6. The ratio in whicha partner receive a rise in his share of profits is known as –

(a) New ratio

(b)Sacrificing ratio
(c) Gaining ratio
(d)Capital ratio

Q7. Increase and decrease in the value of assets and liabilities are recorded through:

(a) Partner’s capital A/c

(b)Revaluation A/c
(c) P&L appropriations A/c
(d)Balance sheet

Q8. In which of the following cases, revaluation acc. Is debited

(a) Increase in the value of assets

(b)Decrease in the value of assets
(c) Decrease in the value of liabilities
(d)No change

Q9. Sacrificing ratio is the difference between

(a) New and old ratio

(b)Old and new ratio
(c) New and gaining ratio
(d)Old and gaining ratio

Q10. Goodwill of the firm on the basis of 2 years purchase of average profit ot
the last 3 year is ₹2500. Find the average profit

(a) ₹50,000
(b)₹25,000
(c) ₹10,000
(d)₹12,500

__________________________________________________________