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Accounting for Partnership Firms — Fundamentals Class 12 Accountancy MCQs Pdf
Select the Best Alternate and tally your answer with the Answers given at the end of the book:
(i) Features or Characteristics of Partnership
1. Features of a partnership firm are :
(A) Two or more persons are 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 tor all as an agent.
(D) All of the above.
Answer
Answer: D
2. Following are essential elements of a partnership firm except: (CPT; June 2012)
(A) At least two persons
(B) There is an agreement between all partners
(C) Equal share of profits and losses
(D) Partnership agreement is for some business.
Answer
Answer: C
3. In case of partnership the act of any partner is : (C.S. Foundation Dec. 2012)
(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
Answer
Answer: A
4. 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
Answer
Answer: B
5. 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
Answer
Answer: C
6. Sleeping partners are those who
(A) take active part in the conduct of the business but provide no capital. However, salary is paid to them.
(B) do not take any part in the conduct of the business but provide capital and share profits and losses in the agreed ratio
(C) take active part in the conduct of the business but provide no capital. However, share profits and losses in the agreed ratio.
(D) do not take any part in the conduct of the business and contribute no capital. However, share profits and losses in the agreed ratio.
Answer
Answer: B
7. The relation of partner with the firm is that of:
(A) An Owner
(B) An Agent
(C) An Owner and an Agent
(D) Manager
Answer
Answer: C
8. What should be the minimum number of persons to form a Partnership :
(A) 2
(B) 7
(C) 10
(D) 20
Answer
Answer: A
9. Number of partners in a partnership firm may be :
(A) Maximum Two
(B) Maximum Ten
(C) Maximum One Hundred
(D) Maximum Fifty
Answer
Answer: D
10, Liability of partner is :
(A) Limited
(B) Unlimited
(C) Determined by Court
(D) Determined by Partnership Act
Answer
Answer: B
11. 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
Answer
Answer: D
12. X, Y and Z are partners sharing profits and losses equally. Their capital balances on March, 31, 2012 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 : (C.S. Foundation; June 2013)
(A) X — ₹80,000 : Y — ₹60,000 : and Z — ₹40,000
(B) X — ₹20,000 : Y — ₹15,000 : and Z — ₹10,000
(C) X — ₹1,00,000 : Y — ₹75,000 : and Z — ₹50,000
(D) Equal
Answer
Answer: B
13. Every partner is bound to attend diligently to his in the conduct of
the business.
(A) Rights
(B) Meetings
(C) Capital
(D) Duties
Answer
Answer: D
(ii) Partnership Deed
14. Forming a Partnership Deed is :
(A) Mandatory
(B) Mandatory in Writing
(C) Not Mandatory
(D) None of the Above
Answer
Answer: C
15. Partnership Deed is also called
(A) Prospectus
(B) Articles of Association
(C) Principles of Partnership
(D) Articles of Partnership
Answer
Answer: D
16. Which of the following is not incorporated in the Partnership Act?
(A) profit and loss are to be shared equally
(B) no interest is to be charged on capital
(C) all loans are to be charged interest @6% p.a.
(D) all drawings are to be charged interest
Answer
Answer: D
17. When is the Partnership Act enforced?
(A) when there is no partnership deed
(B) where there is a partnership deed but there are differences of opinion between the partners
(C) when capital contribution by the partners varies
(D) when the partner’s salary and interest on capital are not incorporated in the partnership deed
Answer
Answer: A
18. In the absence of Partnership Deed, the interest is allowed on partner’s capital: (CPT; June 2011)
(A) @ 5% p.a.
(B) @ 6% p.a.
(C) @ 12% p.a.
(D) No interest is allowed
Answer
Answer: D
19. In the absence of a partnership deed, the allowable rate of interest on partner’s loan account will be :
(A) 6% Simple Interest
(B) 6% p.a. Simple Interest
(C) 12% Simple Interest
(D) 12% Compounded Annually
Answer
Answer: B
20. A and B are partners in partnership firm without any agreement. A has given a loan of ₹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
Answer
Answer: B
21. A and B are partners in a pertnership 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) @ 5% Per Annum
(B) @ 6% Per Annum
(C) @ 6% Per Month
(D) No interest can be charged
Answer
Answer: D
22. 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
Answer
Answer: D
23. 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
Answer
Answer: A
24. In the absence of agreement, partners are not entitled to :
(A) Salary
(B) Commission
(C) Equal share in profit
(D) Both (a) and (b)
Answer
Answer: D
25. Interest on capital will be paid to the partners if provided for in the partnership deed but only out of: (C.S. Foundation; December, 2012)
(A) Profits
(B) Reserves
(C) Accumulated Profits
(D) Goodwill
Answer
Answer: A
26. 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
Answer
Answer: C
27. If any loan or advance is provided by partner then, balance of such Loan Account should be transferred to :
(A) B/S Assets side
(B) B/S Liability Side
(C) Partner’s Capital A/c
(D) Partner’s Current A/c
Answer
Answer: B
28. A, B and C were Partners with capitals of ₹50,000; ₹40,000 and ? 30,000 respectively carrying on business in partnership. The firm’s reported profit for the year was ₹80,000. As per provision of the Indian 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 A of ₹20,000 in addition to his capital contribution.
(A) ₹26,267 for Partner B and C and ₹27,466 for Partner A.
(B) ₹26,667 each partner.
(C) ₹33,333 for A ₹26,667 for B and ₹20,000 for C.
(D) ₹30,000 each partner.
Answer
Answer: A
29. X, Y, and Z are partners in a firm. At the time of division of profit for the year, there was dispute between the partners. .Profit before interest on partner’s capital was ₹6,000 and Y determined interest @24% p.a. on his loan of ₹80,000. There was no agreement on this point. Calculate the amount payable to X, Y, and Z respectively.
(A) ₹2,000 to each partner.
(B) Loss of ₹4,400 for X and Z; Twill take ₹14,800.
(C) ₹400 for A, ₹5,200 for Land ₹400 for Z.
(D) None of the above.
Answer
Answer: C
30. X, Y, and Z are partners in a firm. At the time of division of profit for the year, there was dispute between the partners. Profit before interest on partner’s capital was ₹6,00,000 and Z demanded minimum profit of ₹5,00,000 as his financial position was not good. However, there was no written agreement on this point.
(A) Other partners will pay Z the minimum profit and will share the loss equally.
(B) Other partners will pay Z the minimum profit and will share the loss in capital ratio.
(C) Xand T will take ₹50,000 each and Z will take ₹5,00,000.
(D) ₹2,00,000 to each of the partners.
Answer
Answer: D
31. On 1st June 2018 a partner introduced in the firm additional capital ₹50,000. In the absence of partnership deed, on 31st March 2019 he will receive interest :
(A) ₹3,000
(B) Zero
(C) ₹2,500
(D) ₹1,800
Answer
Answer: B
32. On 1st January 2019, a partner advanced a loan of ₹1,00,000 to the firm. In the absence of agreement, interest on loan on 31st March 2019 will be :
(A) Nil
(B) ₹1,500
(C) ₹3,000
(D) ₹6,000
Answer
Answer: B
33. A partner introduced additional capital of ₹30,000 and advanced a loan of ₹40,000 to the firm at the beginning of the year. Partner will receive year’s interest:
(A) ₹4,200
(B) ₹2,400
(C) Nil
(D) ₹1,800
Answer
Answer: B
34. In the absence of partnership deed, partners share profits or losses :
(A) In the ratio of their Capitals
(B) In the ratio decided by the court
(C) Equally
(D) In the ratio of time devoted
Answer
Answer: C
35. In the absence of Partnership Deed :
(A) Interest will not be charged on partner’s drawings
(B) Interest will be charged @. 5% p.a. on partner’s drawings
(C) Interest will be charged @ 6% p.a. on partner’s drawings
(D) Interest will be charged @ 12% p.a. on partner’s drawings
Answer
Answer: A
36. In the absence of express agreement, interest @ 6% p.a. is provided :
(A) On opening balance of partner’s capital accounts
(B) On closing balance of partner’s capital accounts
(C) On loan given by partners to the firm
(D) On opening balance of partner’s current accounts
Answer
Answer: C
37. Which of the following items are recorded in the Profit & Loss Appropriation Account of a partnership firm?
(A) Interest on Capital
(B) Salary to Partner
(C) Transfer to Reserve
(D) All of the above
Answer
Answer: D
38. Is rent paid to a partner 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.
Answer
Answer: B
(iii) Calculation of Profit and Division of Profit among partners
39. According to Profit and Loss Account, the net profit for the year is ₹1,50,000. The total interest on partner’s capital is ₹18,000 and interest on partner’s drawings is ₹2,000. The net profit as per Profit and Loss Appropriation Account will be :
(A) ₹1,66,000
(B) ₹1,70,000
(C) ₹1,30,000
(D) ₹1,34,000
Answer
Answer: D
40. According to Profit and Loss Account, the net profit for the year is ₹4,20,000. Salary of a partner is ₹5,000 per month and the commission of another partner is ₹10,000. The interest on drawings of partners is ₹4,000. The net profit as per Profit and Loss Appropriation Account will be :
(A) ₹3,54,000
(B) ₹3,46,000
(C) ₹4,09,000
(D) ₹4,01,000
Answer
Answer: A
41. A and B are partners. According to Profit and Loss Account, the net profit for the year is ₹2,00,000. The total interest on partner’s drawings is ₹1,000. As salary is ₹40,000 per year and B’s salary is ₹3,000 per month. The net profit as per Profit and Loss Appropriation Account will be :
(A) ₹1,23,000
(B) ₹1,25,000
(C) ₹1,56,000
(D) ₹1,58,000
Answer
Answer: B
42. According to Profit and Loss Account, the net profit for the year is ₹1,40,000. The total interest on partner’s capital is? 8,000 and a partner is to be allowed commission of ₹5,000. The total interest on partner’s drawings is ₹1,200. The net profit as per Profit and Loss Appropriation Account will be :
(A) ₹1,28,200
(B) ₹1,44,200
(C) ₹1,25,800
(D) ₹1,41,800
Answer
Answer: A
43. Sangeeta and Ankita are partners in a firm. Sangeeta’s capital is ₹70,000 and Ankita’s Capital is ₹50.000. Firm’s profit is ₹60,000. Ankita share in profit will be :
(A) ₹25,000
(B) ₹3 0,000
(C) ₹35,000
(D) ₹20,00
Answer
Answer: B
44. A, B and C are partners. A’s capital is ₹3,00,000 and B’s capital is ₹1,00,000. C has not invested any amount as capital but he alone manages the whole business. C wants ?30,000 p.a. as salary. Firm earned a profit of ₹1,50,000. How much will be each partner’s share of profit:
(A) A ₹60,000; B ₹60,000; C ₹Nil
(B) A ₹90,000; B ₹30,000; C ₹Nil
(C) A ₹40,000; B ₹40,000 and C ₹40,000
(D) A ₹50,000; B ₹50,000 and C ₹50,000.
Answer
Answer: D
45. Net profit of a firm is ₹49,500. Manager is entitled to a commission of 10% on profits before charging his commission. Manager’s Commission will be :
(A) ₹4,950
(B) ₹4,500
(C) ₹5,500
(D) ₹495
Answer
Answer: A
46. Net profit of a firm is ₹79,800. Manager is entitled to a commission of 5% of profits after charging his commission. Manager’s Commission will be :
(A) ₹4,200
(B) ₹380
(C) ₹3,990
(D) ₹3,800
Answer
Answer: D
47. Ram and Shyam are partners in the ratio of 3 : 2. Before profit distribution, ‘ Ram is entitled to 5% commission of the net profit (after charging such commission). Before charging commission, firm’s profit was ₹42,000. Shyam’s share in profit will be :
(A) ₹16,000
(B) ₹24,000
(C) ₹26,000
(D) ₹16,400
Answer
Answer: A
48. A, B and C are partners in the ratio of 5 : 3 : 2. Before B’s salary of ₹17,000 firm’s profit is ₹97,000. How much in total B will receive from the firm?
(A) ₹17,000
(B) ₹40,000
(C) ₹24,000
(D) ₹41,000
Answer
Answer: D
Hint: Total amount received by die partner will be Salary + Share of Profit
49. A, B and C are partners in a firm without any agreement. They have contributed 750,000, 730,000 and 720,000 by way of capital in the firm. A was unable to work for six months in a year due to illness. At the end of year, firm earned a pro lit of 7 15,000. A’s share in the profit will be :
(A) 77.500
(B) 73,750
(C) 75,000
(D) 72,500
Answer
Answer: C
50. In a partnership lirm, partner A is entitled a monthly salary of ₹7,500. At the end of the year, firm earned a profit of ₹75,000 after charging T’s salary. If the manager is entitled a commission of 10% on the net profit after charging his commission, Manager’s commission will be :
(A) ₹7,500
(B) ₹16,500
(C) ₹8,250
(D) ₹15,000
Answer
Answer: D
51. Seeta and Geeta are partners sharing profits and losses in the ratio 4 : 1. Meeta was manager who received the salary of ₹4,000 p.m. in addition to a commission of 5% on net profits after charging such commission. Profit for the year is ₹6,78,000 before charging salary. Find the total remuneration of Meeta.
(A) ₹78,000
(B) ₹88,000
(C) ₹87,000
(D) ₹76,000
Answer
Answer: A
52. Which of the following statement is true?
(A) Fixed capital account will always have a credit balance
(B) Current account can have a positive or a negative balance
(C) Fluctuating capital account can have a positive or a negative balance
(D) All of the above
Answer
Answer: D
(iv) Capital Accounts of Partners
53. Which accounts are opened when the capitals are fixed?
(A) Only Capital Accounts
(B) Only Current Accounts
(C) Capital Accounts as well as Current Accounts
(D) Either Capital Accounts or Current Accounts
Answer
Answer: C
54. Which accounts are opened when the capitals are fluctuating?
(A) Only Capital Accounts
(B) Only Current Accounts
(C) Capital Accounts as well as Current Accounts
(D) Either Capital Accounts or Current Accounts
Answer
Answer: A
55. Balance of partner’s current accounts are :
(A) Debit balance
(B) Credit balances
(C) Debit or Credit balances
(D) Neither Debit nor credit balances
Answer
Answer: C
56. Which item is recorded on the credit side of partner’s current accounts :
(A) Interest on Fanner’s Capitals
(B) Salaries of Partners
(C) Share of profits of Partners
(D) All of the Above
Answer
Answer: D
57. If the Partners’ Capital Accounts are fixed ‘salary payable to partner’ will be recorded :
(A) On the debit side of Partners’ Current Account
(B) On the debit side of Partners’ Capital Account
(C) On the credit side of Partners’ Current Account
(D) None of the above
Answer
Answer: C
58. It the Partner’s Capital Accounts are fixed, interest on capital will be recorded:
(A) On the credit side of Current Account
(B) On the credit side of Capital Account
(C) On the debit side of Current Account
(D) On the debit side of Capital Account
Answer
Answer: A
59. If the Partner’s Capital Accounts are fluctuating, in that case following item/items will be recorded in the credit side of capital accounts :
(A) Interest on capital
(B) Salary of partners
(C) Commission of partners
(D) All of the above
Answer
Answer: D
60. Interest on partner’s capitals will be debited to :
(A) Profit and Loss Account
(B) Profit and Loss Appropriation Account
(C) Partner’s Capital Accounts
(D) None of the Above
Answer
Answer: B
61. Interest on partner’s capitals will be credited to :
(A) Profit and Loss Account
(B) Profit and Loss Appropriation Account
(C) Interest Account
(D) Partner’s Capital Accounts
Answer
Answer: D
62. For the firm interest on drawings is
(A) Capital Payment
(B) Expenses
(C) Capital Receipt
(D) Income
Answer
Answer: D
63. Interest on Partner’s drawings will be debited to :
(A) Profit and Loss Account
(B) Profit and Loss Appropriation Account
(C) Partner’s Current Account
(D) Interest Account
Answer
Answer: C
64. When partners’ capital accounts are floating, which one of the following items will be written on the credit side of the partners’ capital accounts? :
(A) Interest on drawings
(B) Loan advanced by partner to the firm
(C) Partner’s share in the firm’s loss
(D) Salary to the activ e partners
Answer
Answer: D
65. When partners’ capital accounts are fixed, which one of the following items will be written in the partner’s capital account? :
(A) Partner’s Drawings
(B) Additional capital introduced by the partner in the firm
(C) Loan taken by partner from the firm
(D) Loan Advanced by partner to the firm
Answer
Answer: B
66. Interest on partner’s drawings will be credited to
(A) Profit and Loss Account
(B) Profit and Loss Appropriation Account
(C) Partner’s Capital Accounts
(D) None of the Above
Answer
Answer: B
67. For the firm interest on capital is :
(A) Capital Payment
(B) Capital Receipt
(C) Loss
(D) Income
Answer
Answer: C
(v) Interest on Capital
68. On 1st April 2018, 2fs Capital was ₹2,00,000. On 1st October 2018, he introduces additional capital of ₹1,00,000. Interest on capital @ 6% p.a. on 31st March, 2019 will be :
(A) ₹9,000
(B) ₹18,000
(C) ₹10,500
(D) ₹15,000
Answer
Answer: D
69. Xand 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 ?60,000 for the year ended 31st March 2019. Interest on Capital will be :
(A) X ₹16,000; Y ₹8,000
(B) V ₹8.000; Y ₹4,000
(C) X ₹14,400; Y ₹9,600
(D) No Interest will be allowed
Answer
Answer: A
70. 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 2019. Interest on Capital will be :
(A) X ₹16,000; Y ₹8,000
(B) X ₹9,000; Y ₹6,000
(C) X ₹10,000; Y ₹5,000
(D) No Interest will be allowed
Answer
Answer: C
71. 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 2019. Interest on Capital will be :
(A) X ₹16,000; Y ₹8,000
(B) A ₹8,000; Y ₹4,000
(C) X ₹14,400; Y ₹9,600
(D) No Interest will be allowed
Answer
Answer: D
72. 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 2019. As per partnership agreement, interest on capital is treated a charge on profits. Interest on Capital will be :
(A) X ₹16,000; Y ₹8,000
(B) X ₹9,000; Y ₹6,000
(C) X ₹10,000; Y ₹5,000
(D) No Interest will be allowed
Answer
Answer: A
73. 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 S’s share will be:
(A) Profit ₹6,000
(B) Profit ₹4,000
(C) Loss ₹6,000
(D) Loss ₹4,000
Answer
Answer: D
(vi) [nterest on Drawings
74. Partners are suppose to pay interest on drawing only when by the
(A) Provided, Agreement
(B) Permitted, Investors
(C) Agreed, Partners
(D) ‘A’ & ‘C’ above
Answer
Answer: D
75. Where will you record interest on drawings : (CPT; June 2011)
(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.
Answer
Answer: B
76. How would you close the Partner’s Drawing 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’.
Answer
Answer: A
77. If date of drawings of the partner’s is not given in the question, interest is charged for how much time
(A) 1 month
(B) 3 months
(C) 6 months
(D) 12 months
Answer
Answer: C
78. Vikas is a partner in a firm. His drawings during the year ended 31st March, 2019 were ?72,000. If interest on drawings is charged @ 9% p.a. the interest charged will be :
(A) ₹324
(B) ₹6,480
(C) ₹3,240
(D) ₹648
Answer
Answer: C
79. If a fixed amount is withdrawn by a partner on the first day of every month, interest on the total amount is charged for …………… months :
(A) 6
(B) 61/2
(C) 51/2
(D) 12
Answer
Answer: B
80. If a fixed amount is withdrawn by a partner on the last day of every month, interest on the total amount is charged for …………… months :
(A) 12
(B) 6 1/2
(C) 5 1/2
(D) 6
Answer
Answer: C
81. If a fixed amount is withdrawn by a partner in the middle of every month, interest on the total amount is charged for …………… months
(A) 6
(B) 6 1/2
(C) 5 1/2
(D) 12
Answer
Answer: A
82. 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 : (C.S. Foundation, Dec. 2012)
(A) ₹3,600
(B) ₹1,950
(C) ₹1,800
(D) ₹1,650
Answer
Answer: B
83. 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, 2019. If interest on drawings is charged @ 9% p.a. the interest charged will be :
(A) ₹990
(B) ₹1,080
(C) ₹1,170
(D) ₹2,160
Answer
Answer: A
84. 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, 2019. If interest on drawings is charged @ 8% p.a. the interest charged will be :
(A) ₹2,080
(B) ₹1,760
(C) ₹3,840
(D) ₹1,920
Answer
Answer: D
85. If fixed amount is withdrawn by a partner on the first day of each quarter, interest on the total amount is charged for …………….. months
(A) 4.5
(B) 6
(C) 7.5
(D) 3
Answer
Answer: C
86. If a fixed amount is withdrawn by a partner on the last day of each quarter, interest on the total amount is charged for ……………… months
(A) 6
(B) 4.5
(C) 7.5
(D) 3
Answer
Answer: B
87. If a fixed amount is withdrawn by a partner in each quarter, interest on the total amount is charged for ……………….. months
(A) 3
(B) 6
(C) 4.5
(D) 7.5
Answer
Answer: B
88. Anuradha is a partner in a firm. She withdrew ₹6,000 in the beginning of each quarter during the year ended 31st March, 2019. Interest on her drawings @ 10% p.a. will be :
(A) ₹900
(B) ₹1,200
(C) ₹1,500
(D) ₹600
Answer
Answer: C
89. Bipasa is a partner in a firm. She withdrew ₹6,000 at the end of each quarter during the year ended 31st March, 2019. Interest on her drawings @ 10% p.a. will be :
(A) ₹900
(B) ₹600
(C) ₹1,500
(D) ₹1,200
Answer
Answer: A
90. Charulata is a partner in a firm. She withdrew ₹10,000 in each quarter during the year ended 31st March, 2019. Interest on her drawings @ 9% p.a. will be:
(A) ₹1,350
(B) ₹2,250
(C) ₹900
(D) ₹1,800
Answer
Answer: D
91. If equal amount is withdrawn by a partner in the beginning 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
Answer
Answer: C
92. If equal amount is withdrawn by a partner in 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
Answer
Answer: A
93. If equal amount is withdrawn by a partner in each month during a period of 6 months, interest on the total amount will be charged for …………… months
(A) 6
(B) 3
(C) 2.5
(D) 3.5
Answer
Answer: B
94. 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, 2019. If interest on drawings is charged @ 8% p.a. the interest charged will be :
(A) ₹240
(B) ₹140
(C) ₹100
(D) ₹120
Answer
Answer: B
95. 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, 2019. If interest on drawings is charged @ 10% p.a. the interest charged will be :
(A) ₹375
(B) ₹450
(C) ₹525
(D) ₹900
Answer
Answer: A
96. Z is a partner in a firm. He withdrew regularly ?2,000 every month for the six months ending 31st March, 2019. If interest on drawings is charged @ 8% p.a. the interest charged will be :
(A) ₹480
(B) ₹280
(C) ₹200
(D) ₹240
Answer
Answer: D
97. A partner withdraws ₹8,000 each on 1st April and 1st Oct. Interest on his drawings @ 6% p.a. on 31 st March will be :
(A) ₹480
(B) ₹720
(C) ₹240
(D) ₹960
Answer
Answer: B
98. A partner draws ₹2,000 each on 1st April 2018, 1st July 2018, 1st October, 2018 and 1st January 2019. For the year ended 31st March, 2019 interest on drawings @ 8% per annum will be :
(A) ₹540
(B) ₹320
(C) ₹960
(D) ₹400
Answer
Answer: D
99. A partner withdraws from firm ₹7,000 at the end of each month. At the rate of 6% per annum total interest will be :
(A) ₹5,040
(B) ₹2,310
(C) ₹3,570
(D) ₹1,370
Answer
Answer: B
(vii) Adjustments in the Closed Accounts
100. Anu and Tanu are equal partners with fixed capitals of ₹2,00,000 and ₹1,00,000 respectively. After closing the accounts for the year ending 31st – March, 2019 it was discovered that interest on capitals @ 8% p.a. was omitted to be provided. In the adjusting entry :
(A) Anu will be credited by ₹16,000 and Tanu will be credited by ₹8,000
(B) Anu will be debited by ₹16,000 and Tanu will be debited by ₹8,000
(C) Anu will be credited by ₹4,000 and Tanu will be debited by ₹4,000
(D) Anu will be debited by ₹4,000 and Tanu will be credited by ₹4,000
Answer
Answer: C
101. Sony and Romy are equal partners with fixed capitals of ₹4,00,000 and ₹3,00,000 respectively. After closing the accounts for the year ending 31st March, 2019 it was discovered that interest on capitals was provided @ 8% instead of 10% p.a. In the adjusting entry :
(A) Sony will be credited by ₹8,000 and Romy will be credited by ₹6,000.
(B) Sony will be debited by ₹8,000 and Romy will be debited by ₹6,000.
(C) Sony will be debited by ₹1,000 and Romy will be credited by ₹1,000.
(D) Sony will be credited by ₹1,000 and Romy will be debited by ₹1,000.
Answer
Answer: D
102. Asha and Vipasha are equal partners with fixed capitals of ₹5,00,000 and ₹2,00,000 respectively. After closing the accounts for the year ending 31st March 2019 it was discovered that interest on capitals was provided @ 6% instead of 5% p.a. In the adjusting entry :
(A) Asha will be debited by ₹1,500 and Vipasha will be credited by ₹1,500;
(B) Asha will be credited by ₹1,500 and Vipasha will be debited by ₹1,500;
(C) Asha will be debited by ₹5,000 and Vipasha will be debited by ₹2,000;
(D) Asha will be credited by ₹5,000 and Vipasha will be credited by ₹2,000;
Answer
Answer: A
103. P and Q sharing profits in the ratio of 2 : 1 have fixed capitals of ₹90,000 and f60,000 respectively. After closing the accounts for the year ending 31st March 2019 it was discovered that interest on capitals was provided @ 6% instead of 8% p.a. In the adjusting entry :
(A) P will be credited by ₹1,800 and Q will be credited by ₹1,200;
(B) P will be debited by ₹200 and Q will be credited by ₹200;
(C) P will be credited by ₹200 and Q will be debited by ₹200;
(D) P will be debited by ₹1,800 and Q will be debited by ₹1,200;
Answer
Answer: B
104. A and B sharing profits in the ratio of 7 : 3 have fixed capitals of ₹2,00,000 and ₹1,00,000 respectively. After closing the accounts for the year ending 31st March 2019 it was discovered that interest on capitals was provided @ 12% instead of 10% p.a. In the adjusting entry :
(A) A will be debited by ₹4,000 and B will be debited by ₹2,000;
(B) A will be credited by ₹4,000 and B will be credited by ₹2,000;
(C) A will be debited by ₹200 and B will be credited by ₹200;
(D) A will be credited by ₹200 and B will be debited by ₹200;
Answer
Answer: D
105. Xand 7are partners in the ratio of 3 : 2. Their fixed capitals are ₹2,00,000 and ₹1,00,000 respectively. After clsoing the accounts for the year ending 31st March 2019, it was discovered that interest on capital was allowed @ 12% instead of 10% per annum. By how much amount A will be debited/credited in the adjustment entry :
(A) ₹600 (Debit)
(B) ₹400 (Credit)
(C) ₹400 (Debit)
(D) ₹600 (Credit)
Answer
Answer: C
106. X, Y and Z are equal partners with fixed capitals of ₹2,00,000, ₹3,00,000 and ?4,00,000 respectively. After closing the accounts for the year ending 31st March 2019 it was discovered that interest on capitals @ 8% p.a. was omitted to be provided. In the adjusting entry :
(A) Dr. X and Cr. Y by ₹8,000
(B) Cr. X and Dr. Z by ₹8,000
(C) Dr. X and Cr. Z by ₹8.000
(D) Cr. X and Dr. Y by ₹8,000
Answer
Answer: C
107. P, Q and R arc equal partners with fixed capitals of ₹5,00,000, ₹4,00,000 and ₹3,00,000 respectively. After closing the accounts for the year ending 31st March 2019 it was discovered that interest on capitals was provided @ 7% instead of 9% p.a. In the adjusting entry :
(A) P will be credited by ₹2,000 and Q will be debited by ₹2,000.
(B) P will be debited by ₹2,000 and Q will be credited by ₹2,000.
(C) P will be debited by ₹2,000 and R will be credited by ₹2,000.
(D) P will be credited by ₹2,000 and R will be debited by ₹2,000.
Answer
Answer: D
108. X, 7and Z are equal partners with fixed capitals of ₹5,00,000, ?3,00,000 and ₹1,00,000 respectively. After closing the accounts for the year ending 31st March 2019 it was discovered that interest on capitals was provided @ 6% instead of 5% p.a. In the adjusting entry :
(A) Dr. X and Cr. Z by ₹2,000
(B) Cr. X and Dr. Z by ₹2,000
(C) Dr. X and Cr. Y by ₹2,000
(D) Cr. X and Dr. Y by ₹2,000
Answer
Answer: A
109. P, Q, and R sharing profits in the ratio of 2 : 1 : 1 have fixed capitals of f4,00,000, ₹3,00,000 and ₹2,00,000 respectively. After closing the accounts for the year ending 31st March 2019 it was discovered that interest on capitals was provided @ 6% instead of 8% p.a. In the adjusting entry :
(A) Cr. P ₹1,000; Dr. Q ₹1,500 and Cr. R ₹500
(B) Dr. P ₹500; Cr. Q ₹1,500 and Dr. R ₹1,000
(C) Cr. P ₹500; Dr. Q ₹1,500 and Cr. R ₹1,000
(D) Dr. P ₹1,000; Cr. Q ₹1,500 and Dr. R ₹500
Answer
Answer: D
110. 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 2019 it was discovered that interest on capitals was provided @ 12% instead of 10% p.a. In the adjusting entry :
(A) Cr. A ₹1,200; Dr. B ₹800 and Dr. C ₹400
(B) Dr. A ₹1,200; Cr. B ₹800 and Cr. C ₹400
(C) Cr. A ₹800; Cr. B ₹400 and Dr. C ₹1,200
(D) Dr. A ₹800; Dr. B ₹400 and Cr. C ₹1,200
Answer
Answer: B
111. 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 distributed. For rectification, now X will be credited :
(A) ₹15,000
(B) ₹1,000
(C) ₹12,000
(D) ₹7,000
Answer
Answer: D
(viii) Guarantee of Profit to a Partner
112. 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.
Answer
Answer: C
113. Guarantee given to partner ‘A’ by the other partners ‘B & C’ means :
(A) In case of loss, ‘A’ will not contribute towards that loss.
(B) In case of insufficient profits, ‘A’ will receive only the minimum guarantee amount.
(C) In case of loss or insufficient profits, ‘A’ will withdraw the minimum guarantee amount.
(D) All of the above.
Answer
Answer: C
114. P, Q and R are partners in a firm in 3 : 2 : 1. R is guaranteed that he will get minimum of ₹20,000 as his share of profit every year. Firm’s profit was ₹90,000. Partners will get:
(A) P ₹40,000; Q ₹30,000; R ₹20,000;
(B) P ₹42,500; Q ₹27,500; R ₹20,000;
(C) P ₹45,000; Q ₹30,000; R ₹15,000;
(D) P ₹42,000; Q ₹28,000; R ₹20,000;
Answer
Answer: D
115. A, Y and Z are partners in the ratio of 5 : 4 : 3. A has given to Za guarantee of minimum ₹10,000 profit. For the year ending 31st March 2019, firm’s profit is ₹28,800. Js share in profit will be :
(A) ₹9,200
(B) ₹9,600
(C) ₹7,200
(D) ₹12,000
Answer
Answer: A
116. E, Fand G share profits in the ratio of 4 : 3 : 2. G is given a guarantee that his share of profits will not be less than ₹75,000. Deficiency if any, would be borne by E and F equally Firm’s profit was ₹2,70,000. As share of profit will be :
(A) ₹90,000
(B) ₹82,500
(C) ₹97,500
(D) ₹75,000
Answer
Answer: B
117. X, Y, and Z are partners in the ratio of 6 : 4 : 1. In the firm, A has guaranteed Z for his minimum profit of ₹15,000. Firm’s profit was ₹99,000. In the firm profit As share will be :
(A) ₹30,000
(B) ₹15,000
(C) ₹48,000
(D) ₹45,000
Answer
Answer: C
118. P, Q, and R are partners in 3 : 2 : 1. R is guaranteed that his share of profit will not be less than ₹70,000. Any deficiency will be borne by P and Q in the ratio of 2 : 1. Firm’s profit was ₹2,40,000. Share of P will be :
(A) ₹1,00,000
(B) ₹1,10,000
(C) ₹1,20,000
(D) ₹1,02,000
Answer
Answer: A
119. A Y and Z are partners in 5 : 4 : 1. Z is guaranteed that his share of profit will not be less than ₹80,000. Any deficiency will be borne by A and Y in 3 : 2. Firm’s profit was ₹5,60,000. How much deficiency will be borne by Y :
(A) ₹2,14,400
(B) ₹14,400
(C) ₹2,09,600
(D) ₹9,600
Answer
Answer: D
120. P and Q are partners sharing profits in the ratio of 1 : 2. R was manager who received the salary of ₹10,000 p.m. in addition to 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) ₹7,20,000
(B) ₹6,00,000
(C) ₹7,80,000
(D) ₹6,60,000
Answer
Answer: C
121. 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 A’were :
(A) ₹8,000 p.m.
(B) ₹7,000 p.m.
(C) ₹6,000 p.m.
(D) ₹5,000 p.m.
Answer
Answer: D
122. 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) ₹12,000 p.m.
(B) ₹10,000 p.m.
(C) ₹9,000 p.m.
(D) ₹8,000 p.m.
Answer
Answer: B
123. 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 profit and loss appropriation account amounted to ₹40,000. Net Profit of the firm before any appropriations was :
(A) ₹1,22,000
(B) ₹1,13,000
(C) ₹1,17,000
(D) ₹1,45,000
Answer
Answer: D
124. 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 : (CPT, Dec. 2012)
(A) Agreed Ratio
(B) Profit Sharing Ratio
(C) Capital Ratio
(D) Equally
Answer
Answer: C
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