# MCQs For NCERT Class 12 Accountancy Chapter 2 Accounting for Partnership Firms – Basic Concepts

Please refer to the MCQ Questions for Class 12 Accountancy Chapter 2 Accounting for Partnership Firms – Basic Concepts with Answers. The following Accounting for Partnership Firms – Basic Concepts Class 12 Accountancy MCQ Questions has been designed based on the latest syllabus and examination pattern for Class 12. Our experts have designed MCQ Questions for Class 12 Accountancy with Answers for all chapters in your NCERT Class 12 Accountancy book.

## Accounting for Partnership Firms – Basic Concepts Class 12 MCQ Questions with Answers

See below Accounting for Partnership Firms – Basic Concepts Class 12 Accountancy MCQ Questions, solve the questions and compare your answers with the solutions provided below.

Question. In the absence of partnership deed, a partner is entitled to get interest on his capital in firm at:
(a) 12% p.a.
(b) 5% p.a.
(c) 6% p.a.
(d) None of these

D

Question.  Which of the following items is not dealt through Profit and Loss Appropriation Account?
(a) Interest on Partner’s Loan
(b) Partner’s Salary
(c) Interest on Partner’s Capital
(d) Partner’s Commission

A

Question. Mahesh, a partner in a partnership firm, withdraws `15,000 at the end of each quarter throughout the year. Calculate the amount of interest if deed provides for interest on drawings @ 6% p.a.?
(a) `17,500
(b) `1,850
(c) `1,250
(d) `1,350

D

Question. Bawa is manager in a partnership firm and is entitled to receive a salary of `8,000 per month and a commission of 5% on net profit after charging such commission. Profit for the year is `13,56,000 before charging salary and commission. The total remuneration of Bawa is
(a) `1,50,000
(b) `95,000
(c) `1,75,000
(d) `1,56,000

D

Question. Surender, Jitender and Rajiv are partners in a firm sharing profits in the ratio of 5 : 3 : 2. As per partnership deed, Rajiv is to get a minimum amount of `10,000 as profit. Net profit for the year is `40,000. Calculate deficiency (if any) to Rajiv.
(a) `1,250
(b) `1,650
(c) `2,000
(d) `3,500

C

Question. Bablee, Suman and Bharti are partners sharing profits equally. Bablee drew regularly ` 4,000 in the beginning of every month for the six months ended 30th September, 2020. Calculate interest on Bablee’s drawings @ 5% p.a.
(a) `350
(b) `650
(c) `800
(d) `1100

A

Question. Pick the odd one out, with respect to fixed Capital Account:
(a) Capital introduced
(b) Interest on Capital
(c) Capital withdrawn
(d) None of these

B

Question. Salma is a partner in a firm. She withdraws `4,000 per month in the middle of every month during the year ended 31st March, 2021. If interest on drawings is charged @ 8% p.a. the amount of interest on drawings will be
(a) `2,350
(b) `1,860
(c) `1,510
(d) `1,920

D

Question. In case of partnership the act of any partner is .
(a) Binding on all partners
(b) Binding on that partner only
(c) Binding on all partners except that particular partner
(d) None of the above

A

Question. In case of guarantee of minimum profit to a partner deficiency of guaranteed partner is from shared by remaining partner in ____________.
(a) Profit Sharing Ratio
(b) Agreed Ratio
(c) Sacrificing Ratio
(d) Gaining Ratio

B

Question. Manager’s commission is a ___________ against profits
(a) Charge
(b) Appropriation
(c) Both a&b
(d) None of the above

C

Question. A and B are partners in partnership firm without any agreement. A has given a loan of Rs 50,000 to the firm. At the end of year loss was incurred in the business.
Following interest may be paid to A by the firm .
(a) @5% Per Annum
(b) @ 6% Per Annum
(c) @ 6% Per Month
(d) As there is a loss in the business, interest can’t be paid

B

Question. Rani and Shyam are partners in a firm. They are entitled to interest on their capital but the net profit was not sufficient for paying his interest, then the net profit will be disturbed among partner in
(a) 1 . 2
(b) Profit Sharing Ratio
(c) Capital Ratio
(d) Equally

C

Question. In the absence of partnership deed, the following rule will apply .
(a) No interest on capital
(b) Profit sharing in capital ratio
(c) Profit based salary to working partner
(d) 9% p.(a) interest on drawings

A

Question. Which one of the following items is recorded in the Profit and Loss appropriation account
(a) Interest on Loan
(b) Partner Salary
(c) Rent paid to Partner’s
(d) Managers Commission

B

Question. Which one of the following items cannot be recorded in the profit and loss appropriation account?
(a) Interest on capital
(b) Interest on drawings
(c) Rent paid to partners
(d) Partner’s salary

B

Question. In the absence of Partnership Deed, the interest is allowed on partner’s capital.
(a) @ 5% p.(a)
(b) @ 6% p.(a)
(c) @ 12% p.(a)
(d) No interest is allowed

D

Question. Number of partners in a partnership firm may be .
(a) Maximum Two
(b) Maximum Ten
(c) Maximum One Hundred
(d) Maximum Fifty

D

Question. Oustensible partners are those who
(a) do not contribute any capital but get some share of profit for lending their name to the business
(b) contribute very less capital but get equal profit
(c) do not contribute any capital and without having any interest in the business, lend their name to the business
(d) contribute maximum capital of the business

C

Question. Which of the following statement is true?
(a) A minor cannot be admitted as a partner
(b) A minor can be admitted as a partner, only into the benefits of the partnership
(c) A minor can be admitted as a partner but his rights and liabilities are same of adult partner
(d) None of the above

B

Question. A and B are partners in a partnership firm without any agreement. A devotes more time for the firm as compare to (b) A will get the following commission in addition to profit in the firm’s profit.
(a) 6% of profit
(b) 4% of profit
(c) 5% of profit
(d) None of the above

D

Question. Interest on capital will be paid to the partners if provided for in the partnership deed but only out of.
(a) Profits
(b) Reserves
(c) Accumulated Profits
(d) Goodwill

B

Question. A and B are partners in a partnership firm without any agreement. A has withdrawn Rs 50,000 out of his Capital as drawings. Interest on drawings may be charged from A by the firm .
(a) @ 5% Per Annum
(b) @ 6% Per Annum
(c) @ 6% Per Month
(d) No interest can be charged

D

Question. In the absence of agreement, partners are not entitled to .
(a) Salary
(b) Commission
(c) Equal share in profit
(d) Both (a) and (b)

D

Question. If average capital employed in a firm is Rs 12,00,000 , actual profit is Rs 1,50,000 and Normal rate of return is 10% per annum . The amount of super profit will be
______
(a) Rs 15000
(b) Rs 12000
(c) Rs 30000
(d) None of the above

A

Question. According to Profit and Loss Account, the net profit for the year is Rs 1,50,000. The total interest on partner’s capital is Rs 18,000 and interest on partner’s drawings is Rs 2,000. The net profit as per Profit and Loss Appropriation Account will be .
(a) Rs 1,66,000
(b) Rs 1,70,000
(c) Rs 1,30,000
(d) Rs 1,34,000

D

Question. A,B and C were partner in a firm sharing Profit in the ratio of 3.2.1 during the year the firm earned profit of Rs. 84,000. Calculate the amount of Profit or Loss transferred to the capital A/c of (b)
(a) Loss Rs. 87,000
(b) Profit Rs. 87,000
(c) Profit Rs.28,000
(d) Profit Rs.14,000

C

Question. Pick the odd one out:
(a) Rent to partner
(b) Manager’s Commission
(c) Interest on Partner’s Loan
(d) Interest on Partner’s capital

C

Question. On 1st January, 2021 a partner advanced a loan of `1,00,000 to the firm. In the absence of agreementinterest on loan on 31st March, 2021 will be:
(a) Nil
(b) `1,500
(c) `3,000
(d) `6,000

B

Question. Neena, Meena and Reena are partners sharing profits in the ratio of 3 : 3 : 2. As per the partnershipagreement, Reena is to get a minimum amount of `80,000 as her share of profits every year and anydeficiency on this account is to be personally borne by Neena. The net profit for the year ended 31stMarch, 2021 amounted to `3,12,000. Calculate the amount of deficiency to be borne by Neena?
(a) `1,000
(b) `4,000
(c) `8,000
(d) `2,000

D

Question.  Number of Partners in a partnership firm may be:
(a) Maximum 2
(b) Maximum 10
(c) Maximum 100
(d) Maximum 50

D

Question.  Bablee, Suman and Bharti are partners sharing profits equally. Bablee drew regularly ` 4,000 in the beginning of every month for the six months ended 30th September, 2020. Calculate interest on Bablee’s drawings @ 5% p.a.
(a) `350
(b) `650
(c) `800
(d) `1100

A

Question. Forming a Partnership deed is:
(a) mandatory
(b) mandatory in writing
(c) not mandatory
(d) none of the above

C

Question.  Which of the following items is/are recorded in the Profit and Loss Appropriation Account of apartnership firm?
(a) Interest on capital
(b) Transfer to Reserve
(c) Salary to partner
(d) All of the above

D

Question. If equal amount is withdrawn by a partner at the end of each quarter, interest on the total amount will
be charged for ………….. months.
(a) 2½
(b) 4½
(c) 3½
(d) 6

B

Question. Interest on capital will be paid to the partners if provided for in the partnership deed but only out of
(a) Profits
(b) Reserves
(c) Accumulated Profits
(d) Goodwill

A

Question. When a partner is given guarantee by other partners, loss on such guarantee will be borne by:
(a) Partnership firm
(b) All the other partners
(c) Partners who give the guarantee
(d) Partner with highest profit sharing ratio.

C

Question. How would you close the Partner’s Drawings Account:
(a) By transfer to Capital or Current Account Debit Side.
(b) By transfer to Capital Account Credit Side.
(c) By transfer to Current Account Credit Side.
(d) Either (b) or (c)

A

Question. In the absence of partnership deed, the following rule will apply:
(a) No interest on capital
(b) Profit sharing in Capital Ratio
(c) 8% p.a. interest on partners’ loan
(d) 9% p.a. interest on drawings

A

Question. Arjun and Varun are partners in the ratio of 3 : 2. Their fixed capitals are `20,000 and `10,000 respectively.After closing the accounts for the year ending 31st March 2021, it was discovered that interest on capitalwas allowed @ 12% instead of 10% per annum. By how much amount Arjun will be debited/credited inthe adjustment entry:
(a) `600 (Debit)
(b) `400 (Credit)
(c) `400 (Debit)
(d) `600 (Credit)

C

Question. X and Y are partners. Y 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 Y’s drawings amounts to `8,250. Drawings of Y were:
(a) `12,000 p.m.
(b) `10,000 p.m.
(c) `9,000 p.m.
(d) `8,000 p.m.

B

Question. A sleeping partner is one who:
(a) does not provide capital but takes active part in the firm.
(b) provides capital but does not share profit and loss of the firm.
(c) provides capital, takes active part but does not share profits and losses of the firm.
(d) provides capital, share profits and losses of the firm but does not take active part in the firm.

D

Question. Profit on Profit & Loss Appropriation Account should be transferred to:
(a) Credit Side of Partner’s Capital Account
(b) Debit Side of Partner’s Capital Account
(c) Assets side of Balance Sheet
(d) Liabilities side of Balance Sheet

A

Question. Mohit and Rohit were partners in a firm with capital of 80,000 and 40,000 respectively. The firm earned a profit of 30,000 during the year Mohit’s share in the profit will be:
(a) 2,000
(b) 10,000
(c) 15,000
(d) 18,000

C

Question. Which of the following items is not dealt through Profit and Loss Appropriation Account? (CBSE SQP 2020-21)
(a) Interest on Partner’s Loan
(b) Partner’s Salary
(c) Interest on Partner’s Capital
(d) Partner’s Commission

A

Question. E, F and G are partners sharing profits in the ratio of 3:3:2. As per the partnership agreement, G is to get a minimum amount of 80,000 as his share of profits every year and any deficiency on this account is to be personally borne by E. The net profit for the year ended 31st March, 2020 amounted to 3,12 ,000. Calculate the amount of deficiency to be borne by E? (CBSE SQP 2020-21)
(a) 1,000
(b) 4,000
(c) 8,000
(d) 2,000

D

Question. X, Y and Z are partners in a firm sharing profits and losses in the ratio of 6:4:1.X guaranteed a profit of 15,000 to Z. The net profit for the year ending 31 March, 2020 was `99,000. X’s share in the profit of the firm will be:
(a) 30,000
(b) 15,000
(c) 48,000
(d) 45,000

C

Question. Akshat, Bilal and Charu are partners dealing in the sale of sports equipment. Akshat, without the knowledge of Bilal and Charu, is also running the business of supplying sports equipment to a few sports clubs in which his son is a member. He is earning good profits from this business but did not inform Bilal and Charu about this. Was Akshat correct in doing so?

Ans. No, Akshat was not correct in doing so. Reason: If a partner carries on any business of the same nature as and competing with that of the firm, he shall account for and pay to the firm, all profit made by him in that business.

Question. By virtue of Section 464 of the Companies Act, 2013 the Central Government is empowered to prescribe maximum number of partners in a firm but the number of partners cannot be more than __________
(a) 50
(b)100
(c) 20
(d) 10

B

Question. Can a partner be exempted from sharing the losses in a firm? If yes, under what circumstances?

Yes, if partnership deed so provides. For example, in case of guarantee of minimum profit to a partner.

Question. Ritesh and Hitesh are childhood friends. Ritesh is a consultant whereas Hitesh is an architect. They contributed equal amounts and purchased a building for 2 crores. After a year, they sold it for 3 crores and shared the profits equally. Are they doing the business in partnership ? Give reason in support of your answer.

No, Ram and Mohan can’t be admitted as partners.Reason: As per the Companies Miscellaneous Rules, 2014 the Maximum number of partners in a partnership firm can be 50.

Question. A, B and C decided that interest on capitals will be provided to each partner @ 5% p.a. But after one year C wants that no interest on capital is to be provided to any partner. State how `C’ can do this?

Yes, C can do so by altering the provisions of partnership deed, i.e., redrafting the deed, provided all the partners unanimously agree for it.

Question. Ram and Mohan are partners in a firm without any partnership deed. Their capitals are: Ram 8,00,000 and Mohan 6,00,000. Ram is an active partner and looks after the business. Ram wants that profit should be shared in proportion of capitals. State with reason whether his claim is valid or not.

His claim is not valid because in the absence of a partnership deed, profits and losses should be shared equally.

Question. A partnership deed provides for the payment of interest on capital but there was a loss instead of profits during the year 2019-20 .At what rate will the interest on capital be allowed?
(a) 9% p.a.
(b) 6% p.a.
(c) The rate specified in the partnership deed
(d) No interest on capital will be allowed

D

Question. Kanha, Neeraj and Asha were partners in a firm. They admitted Raghav their Landlord as a partner in the firm. Raghav brings sufficient amount of capital and goodwill premium for his share in the profits. Raghav had given a loan of 1,00,000 @ 10% p.a. interest to the partnership firm before he became the partner. Now the accountant of the firm is emphasizing that the interest on loan should be paid @ 6% p.a. Is he right in doing so ? Give reason in support of your answer.

No, he is not correct. Reason: He will get interest @10% p.a. because of the agreement between Raghav and the firm.

Question. X and Y are equal partners. They had advanced a loan of 40,000, contributed equally to the firm on 1st August, 2019. The partnership deed is silent regarding the payment of interest on loan. What amount of interest on loan is payable to X, if the firm closes its books of account on 31st March every year?
(a) Nil
(b) 2,400
(c) 1,600
(d) 800

D

Question. Interest on money advanced by a partner to the firm beyond the amount of his capital for the purpose of business is paid @ 6% p.a. True/False? Give reason.

False: Interest on partner’s loan is paid at the rate specified in the partnership deed. It is paid @ 6% p.a. if there is no express agreement between the parters regarding the rate of interest on partner’s loan.

Question. You and your friends Amit and Vinod are partners in a firm sharing profits and losses equally. State, who is correct in the following case? Give reasons also. Amit has provided a capital of 50,000 whereas Vinod provided 10,000 only as capital. Vinod, however, has provided 20,000 as loan to the firm. There is no partnership agreement. Vinod claims interest of 1,200, whereas you and Amit do not want to give any interest.

Vinod is correct. Since there is no partnership agreement, interest on Vinod’s loan @ 6% p.a. = 20,000 × 6/100 = 1,200.

Question. Partner’s capital account always shows a credit balance.True/False? Give reasons.

False: Under fluctuating capital method, partner’s capital account may sometimes show a debit balance. It is only under fixed capital method that the partner’s capital account will always show a credit balance.

Question. Partner’s capital account will not show a debit balance in spite of losses year after year when _______ because ______.

Partners’ capitals are fixed; because partner’s capital remains fixed unless there is addition or withdrawal of capital. Under this method, the ‘share of loss’ is debited to the partner’s current account.

Question. A and B are partners having fixed capitals of 2,00,000 and 1,00,000 respectively. At the end of the year 2019-20, their current accounts showed balances: A 1,00,000 (Cr.) B 5,000 (Dr.). Where will B’s current account balance be shown in the books of A and B?
(a) On the liabilities side of the Balance Sheet.
(b) On the assets side of the Balance Sheet.
(c) On the debit side of Profit and Loss Appropriation A/c.
(d) On the credit side of Profit and Loss Appropriation A/c.

B

Question. A and B are partners sharing profits in the ratio of 3 : 2 with capitals of 50,000 and 30,000 respectively. Interest on capital is payable @ 6% p.a. B is to be allowed a salary of 1,250 semi-annually. During the year 2019-20, the profits prior to the calculation of interest on capital but after charging B’s salary amounted to 12,500. 10% of the Net Profit is to be transferred to the General Reserve. What Journal entry will be passed for transfer of profit to General Reserve?

Debit Profit and Loss Appropriation A/c by 1,500 and credit General Reserve A/c by 1,500.

Question. Abha and Bharat were partners. They shared profits and losses equally. On April 1st, 2019 their capital accounts showed balances of 3,00,000 and 2,00,000 respectively. Calculate the share of divisible profit of the partners if the partnership deed provided for interest on capital @10% p.a. and the firm earned a profit of 50,000 for the year ended 31st March, 2020.
(a) Abha 30,000; Bharat 20,000
(b) Abha 25,000; Bharat 25,000
(c) Abha ‘Nil’; Bharat ‘Nil’
(d) None of the above

C

Question. 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 partner’s drawing is 4,000. A’s salary is 4,000 per quarter and B’s salary is 40,000 per annum. The net profit/loss earned during this year was:
(a) 3,02,000
(b) 1,98,000
(c) 3,06,000
(d) 2,50,000

A

Question. Anna and Bobby were partners sharing profits and losses in the ratio of 5 : 3. On 1st April, 2019 their capital accounts showed balances of 3,00,000 and 2,00,000 respectively. 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, 2020. The interest on partners’ capitals will be:
(a) 30,000 and 20,000 respectively
(b) 27,000 and 18,000 respectively
(c) 22,500 and 22,500 respectively
(d) None of the above

B

Question. A, B and C were partners in a firm sharing profits in the ratio of 3 : 2 : 1. During the year the firm incurred a loss of 84,000. The amount of loss transferred to the capital accounts of A, B and C will be:
(a) Loss debited to the capital accounts of A, B and C equally.
(b) Nil
(c) Loss debited to the capital accounts of A, B and C will be 42,000, 28,000 and 14,000 respectively.
(d) None of the above

C

Question. Reena and Raman are partners with capitals of 3,00,000 and 1,00,000 respectively. The profit (as per Profit and Loss Account) for the year ended March 31, 2020 was 1,20,000. Interest on capital is to be allowed at 6% p.a. Raman was entitled to a salary of 30,000 p.a. The drawings of partners were 30,000 and 20,000. The interest on drawings to be charged to Reena was Rs. 1,000 and to Raman, 500. Their share of profit after necessary appropriations are:
(a) Reena 50,625; Raman 16,875
(b) Reena 33,750; Raman 33,750
(c) Reena 33,000; Raman 33,000
(d) Reena 48,750; Raman 48,750

B

Question.Aakriti and Bindu entered into partnership for making garments on April 01, 2019 without any partnership agreement. They introduced Capitals of 5,00,000 and 3,00,000 respectively. On October 01, 2019, Aakriti advanced 20,000 by way of loan to the firm without any agreement as to interest. Profit and Loss account for the year ended March 31 2020 showed profit of 43,000 before charging interest on Aakriti’s loan. Their share of profit for the year 2019-20 are:
(a) 21,200 each
(b) 21,500 each
(c) 26,875 and 16,125 respectively
(d) 26,500 and 15,900 respectively

A

Question. of 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 during 2019-20 was 21,000. In what ratio the appropriation of profit will be made?

(a) 3 : 2
(b) 1 : 1
(c) 3 : 4
(d) 4 : 3

A

Question. Under which of the following situation interest on partners’ capitals shall not be provided?
(a) If the firm has incurred net loss during the year.
(b) If partners’ capitals are equal and their profit sharing ratio is also equal.
(c) Both (a) and (b)
(d) If the net profit is less than the total amount payable to partners as interest on capitals.

C

Question. Anna and Bobby were partners sharing profits and losses in the ratio of 5 : 3. On 1st April, 2019 their capital accounts showed balances of 3,00,000 and 2,00,000 respectively. 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, 2020. The interest on partners’ capitals will be:
(a) 30,000 and 20,000 respectively
(b) 27,000 and 18,000 respectively
(c) 22,500 and 22,500 respectively
(d) None of the above

B

Question. A and B are partners in a firm having capitals 5,00,000 and 10,00,000 respectively. The partnership deed provides for charging interest on drawings @ 5% p.a. A withdrew `40,000 for his personal use during the year 2019-20. B withdrew 2,00,000 from his capital 1.1.2020. The amount of interests that will be charged on partners’ drawings are:
(a) A 1,000; B 5,000
(b) A 2,000; B 10,000
(c) A 1,000; B Nil
(d) A `2,000; B Nil

C

Question. Ram and Shyam are partners sharing profits/losses equally. Ram withdrew 1,000 p.m. regularly on the first day of every month during the year 2019-20 for personal expenses. If interest on drawings is charged @ 5% p.a. What will be the interest on the drawings of Ram?
(a) 50
(b) 27
(c) 600
(d) 325

D

Question. A and B are partners in a firm having capitals 5,00,000 and 10,00,000 respectively. The partnership deed provides for charging interest on drawings @ 5% p.a. A withdrew `40,000 for his personal use during the year 2019-20. B withdrew 2,00,000 from his capital 1.1.2020. The amount of interests that will be charged on partners’ drawings are:
(a) A 1,000; B 5,000
(b) A 2,000; B 10,000
(c) A 1,000; B Nil
(d) A `2,000; B Nil

C

Question. M and N are partners having capitals of 50,000 and 1,00,000 respectively. On 1 April 2020, P was admitted with a capital of 2,00,000. At the end of the year 2020, the firm earned a profit of 30,000. How should the profits be distributed among partners, if there is no partnership deed?
(a) Equally
(b) In the ratio of 1:2:4
(c) In the ratio of 1:2:3
(d) None of the above

A

Question. Verma and Kaul are partners in a firm. The partnership agreement provides that interest on drawings should be charged @ 6% p.a. Kaul withdrew 3,000 per quarter, starting from April 01, 2019. What will be the interest on Kaul’s drawings during the year 2019-20?
(a) 180
(b) 90
(c) 270
(d) 450

D

Question. Dev withdrew `10,000 on 15th day of every month. Interest on drawings was to be charged @ 12% per annum. Interest on Dev’s drawings will be:
(a) 14,400
(b) 7,200
(c) 1,200
(d) None of these

B

Question. Himanshu withdrew 2,500 at the end of each month. The Partnership deed provides for charging the interest on drawings @ 12% p.a. What will be the interest on Himanshu’s drawings for the year ending 31st December, 2017?
(a) 300
(b) 137.50
(c) 1,650
(d) 1,800

C

Question. One of the partners in a partnership firm has withdrawn `9,000 at the end of each quarter, throughout the year. The interest on drawings at the rate of 6% per annum will be:
(a) 540
(b) 2,160
(c) 810
(d) None of these

C

Question. Which of the following statements is true?
(a) Fixed capital account will always have a credit balance.
(b) Current account can have a positive or negative balance.
(c) Fluctuating capital can have a positive or a negative balance
(d) All of the above

D

Question. Ravina and Karishma are partners sharing profits and losses in the ratio of 3 : 2 having the capital of`80,000 and `50,000 respectively. They are entitled to 9% p.a. interest on capital before distributing theprofits. During the year firm earned `7,800 before allowing any interest on capital. Profits apportionedamong Ravina and Karishma is:
(a) `4,680 and `3,120
(b) `4,800 and `3,000
(c) `5,000 and `2,800
(d) None of these

B

Question.In the case of fixed capital method, adjustments in respect of profit, loss, drawings etc. are made in
(a) Current Account
(b) Capital Account
(c) Both (a) and (b)
(d) None of these

A

Question. Neelu and Rita are the two partners having a capital of `50,000 and `60,000. Interest on capital is @ 5%p.a. If the profit before appropriation is `4,600, then find out the interest allocated to the partners:
(a) `3,500 and `1,100
(b) `600 and `4,000
(c) `2,091 and `2,509
(d) `2,500 and `3,000

C

Question. In which condition a partnership firm is deemed to be dissolved?
(b) on retirement of partner
(c) on expiry of the period of partnership
(d) on loss in partnership

C

Question.If equal amount is withdrawn by a partner at the end of each month during a period of 6 months,
interest on the total amount will be charged for ……………… months.
(a) 2.5
(b) 3
(c) 3.5
(d) 6

A

Question. Every partner is bound to attend diligently to his …………….. in the conduct of the business.
(a) rights
(b) meetings
(c) capital
(d) duties

D

Question. Where will you record interest on drawings:
(a) Debit Side of Profit & Loss Appropriation Account.
(b) Credit Side of Profit & Loss Appropriation Account.
(c) Credit Side of Profit & Loss Account.
(d) Debit Side of Capital/Current Account Only.

B

Question. Partnership is defined under which section of the Partnership Act, 1932?
(a) Section 4
(b) Section 2
(c) Section 3
(d) Section 5

A

Question. Partner’s Capital Account and Partner’s Current Account are prepared in the case of:
(a) Fixed Capital Account
(b) Fluctuating Capital Account
(c) Both (a) and
(b) (d) Neither (a) nor (b)

A

Question.Which one of the following is NOT an essential feature of a partnership?
(a) There must be an agreement.
(b) There must be a business.
(c) The business must be carried on for profits.
(d) The business must be carried on by all the partners.

D

Question. Partners are supposed to pay interest on drawings only when …………….. by the …………….. .
(a) provided, deed
(b) permitted, investors
(c) agreed, partners
(d) (a) and (c) above

A

Question. If a firm makes exceptional profits which are not routine in nature, then such profits will not be includedwhile:
(a) calculating Profit share of the Partners
(b) calculating Goodwill of the firm
(c) Both (a) and
(b) (d) None of the above

B

Question.Akshay and Shubham are partners sharing profits and losses in the ratio of 4 : 1. Girish, the managerwas entitled to a commission @ 5% of net profits after charging such commission. If the profit beforecommission is `6,30,000 find out the commission:
(a) `78,000
(b) `30,000
(c) `28,000
(d) `32,000

B

Question. Features of a partnership firm are:
(a) Two or more persons carrying common business under an agreement.
(b) They are sharing profits and losses in the fixed ratio.
(c) Business is carried by all or any of them acting for all as an agent.
(d) All of the above.

B

Question.In the absence of any agreement, partners are entitled to receive interest on their loans at the rate of:
(a) 12% Simple Interest
(b) 12% Compounded Annually
(c) 6% Compouned Annually
(d) 6% p.a. Simple Interest

D

Question. Loss in Profit & Loss Appropriation Account will:
(a) Reduce capital of partners
(b) Increase capital of partners
(c) Both (a) and
(b) (d) None

Question.The relationship between persons who have agreed to share the profits of a business carried on by allor any of them acting for all is known as:
(a) Partnership
(b) Joint Venture
(c) Association of Persons
(d) Body of Individuals

A

Question. Ritu, Mannu and Neetu were Partners with capitals of `50,000; `40,000 and `30,000 respectively carryingon business in partnership. The firm’s reported profit for the year was `80,000. As per provision of theIndian Partnership Act, 1932, find out the share of each partner in the above amount after taking into
account that no interest has been provided on an advance by Ritu of `20,000 in addition to her capitalcontribution.
(a) `27,466 for Ritu and `26,267 each for Mannu and Neetu
(b) `26,666 each partner
(c) `33,333 for Ritu, `26,666 for Mannu and `20,000 for Neetu
(d) `30,000 each partner

A

Question.Sonu, Titu and Sweety are partners in a firm. At the time of division of profit for the year, there wasdispute between the partners. Profits before interest on partners’ capital was `6,000 and Titu determinedinterest @ 24% p.a. on his loan of `80,000. There was no agreement on this point. Calculate the amountpayable to Sonu, Titu and Sweety respectively.
(a) `2,000 to each partner
(b) Loss of `4,400 for Sonu and Sweety and Titu will take `14,800
(c) `400 for Sonu, `5,200 for Titu and `400 for Sweety
(d) None of the above

C

Question. Partner’s Current Accounts are opened in case their Capital Accounts are:
(a) Fluctuating
(b) Fixed
(c) Both (a) and (b)
(d) None

B

Question. Alpna, Anjali and Harsha are partners in a firm. At the time of division of profit for the year there wasdispute between the partners. Profits before interest on partners’ capital was `6,000 and Z demandedminimum profit of `5,000 as his financial position was not good. However, there was no writtenagreement on this point.
(a) Other partners will pay Harsha the minimum profit and will share the loss equally.
(b) Other partners will pay Harsha the minimum profit and will share the loss in capital ratio.
(c) Alpna and Anjali will take `500 each and Harsha will take `5,000.
(d) `2,000 to each of the partners.

D

Question. In the absence of partnership deed, interest on drawings is payable at:
(a) 2%
(b) Not payable
(c) 5%
(d) 6%

B

Question. Is rent paid to a partner an appropriation of profits?
(a) It is appropriation of profit.
(b) It is not appropriation of profit.
(c) If partner’s contribution as capital is maximum.
(d) If partner is a working partner.

B

Question.What would be the profit sharing ratio, if the partnership act is complied with:
(a) As per Agreement
(b) Equally
(c) In Capital Ratio
(d) None of the above.