Ch: 1 Accounting for Partnership Firms- Basic Concepts

Worksheet -I

1 Marks
Q1 Amit, Sumit and Kiara are partners sharing profits and losses in the ratio of 2:2:1. Sumit is entitled
to a commission of 15% on the net profit after charging such commission. The net profit before
charging commission is ₹ 9,20,000. The amount of commission payable to Sumit will be:
a) ₹ 1,20,000 b) ₹ 1,38,000
c) ₹ 48,000 d) ₹ 55,200

Q2 Choose the correct sequence of the following transactions in context of Division of Profits.
(i) Guarantee by Firm to Partners
(ii) Guarantee by Partners to Firm
(iii) Transfer of Profits to Profit and Loss Appropriation Account
(iv) Guarantee by Partner to Partner
a) (i); (iii); (iv); (ii) b) (iii); (i); (ii); (iv)
c) (iii); (ii); (i); (iv) d) (ii); (iii); (iv); (i)

Q3 In the absence of agreement to contrary, the profit-sharing ratio will be:

a) in ratio of capital b) in the ratio of work done
c) equal d) none of these

Q4 A, B and C are in partnership business. A used ₹ 2,00,000 belonging to the firm without the
information to other partners and made a profit of ₹ 35,000 by using this amount. Which decision
should be taken by the firm to rectify this situation?
a) A need to return only ₹ 2,00,000 to the firm.
b) A is required to return ₹ 35,000 to the firm.
c) A is required to pay back ₹ 35,000 only equally to B and C.
d) A need to return ₹2,35,000 to the firm.

Q5 P, Q and R are partners in a firm sharing profits and losses in the ratio of 2:2:1. For the year ended
31st March, 2022, interest on capital was credited to them @ 10% p.a. instead of 5% p.a. Their
fixed capitals were ₹ 2,00,000; ₹ 1,00,000 and ₹ 50,000 respectively. The necessary adjustment
entry to rectify the error will be:
Journal
Date Particulars L.F Dr. (₹) Cr. (₹)
a) P’s Current A/c Dr. 2,000
To Q’s Current A/c 1,000
To R’s Current A/c 1,000
b) P’s Current A/c Dr. 3,000
To Q’s Current A/c 2,000
To R’s Current A/c 1,000
c) P’s Capital A/c Dr. 2,000
To Q’s Capital A/c 1,000
To R’s Capital A/c 1,000
 d) P’s Capital A/c Dr. 3,000
To Q’s Capital A/c 2,000
To R’s Capital A/c 1,000

Q6 Girdhar, a partner withdrew ₹ 5,000 in the beginning of each quarter and interest on drawings was
calculated as ₹1,500 at the end of accounting year 31st March, 2023. What is the rate of interest on
drawings charges?
a) 6% p.a. b) 8% p.a.
c) 10% p.a. d) 12% p.a.

Q7 Interest on Partners’ Loan is credited to:

a) Partners’ Fixed Capital Account b) Partners’ Current Account
c) Partners’ Loan Account d) Partners’ Drawings Account

Q8 A and B are partners in a firm. The net divisible profit as per Profit and Loss Appropriation A/c is ₹
2,50,000. The total interest on partners’ drawings were ₹ 4,000. A is entitled to a salary of ₹ 4,000
per quarter and B ₹ 40,000 per annum. The net profit/loss earned during the year is:
a) ₹ 11,000 b) ₹ 12,840
c) ₹ 21,400 d) ₹ 3,600

Q9 Shyam, Gopal and Arjun are partners carrying on garment business. Shyam withdrew ₹10,000 in
the beginning of each quarter. Gopal, withdrew garments amounting to ₹ 15,000 to distribute it to
flood victims, and Arjun withdrew ₹ 20,000 from his capital account. The partnership deed
provides for interest on drawings @ 10% p.a. The interest on drawing charged from Shyam, Gopal
and Arjun at the end of the year will be:
a) Shyam ₹ 4,800; Gopal ₹ 1,000; Arjun ₹ 2,000.
b) Shyam ₹ 4,800; Gopal ₹ 1,500; Arjun ₹ 2,000.
c) Shyam ₹ 2,500; Gopal ₹ 750; Arjun Nil
d) Shyam ₹ 4,800; Gopal Nil; Arjun Nil.

Q10 Salman, Yasmin and Zeenat are partners, sharing profits in the ratio of 3:2:1.
Zeenat is guaranteed a minimum profit of ₹ 60,000 p.a. During the year the firm incurred a loss of
₹ 1,20,000. The share of profit (loss) of partners are:
a) Salman (₹ 1,08,000), Yasmin (₹ 72,000) and Zeenat ₹ 60,000
b) Salman (₹ 1,00,000), Yasmin (₹ 80,000) and Zeenat ₹ 60,000
c) Salman (₹ 1,20,000), Yasmin (₹ 60,000) and Zeenat ₹ 60,000
d) None of these

Q11 The Gross Profit of a partnership firm is ₹ 8,20,000 and indirect expenses other than the manager’s
commission is ₹ 28,000.
The manager is entitled to a commission of 10% on net profit after charging such commission,
which amounts to:
a) ₹ 78,000 b) ₹ 80,000
c) ₹ 72,000 d) ₹ 79,200
Q12 A and B are partners. B draws a fixed amount at the end of every quarter. Interest on drawings is
charged @ 15% p.a. At the end of the year interest on B’s drawings amounted to ₹ 9,000. Drawings
of B were:
a) ₹ 24,000 per quarter b) ₹ 40,000 per quarter
c) ₹ 30,000 per quarter d) ₹ 80,000 per quarter

Q13 Green and Orange are partners. Green 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 Green’s drawings
amounts to ₹ 2,600. Monthly drawings of Green were:
a) ₹ 8,000 b) ₹ 60,000
c) ₹ 7,000 d) ₹ 5,000

Q14 X, Y and Z were three partners sharing profits in the ratio of 3:2:1. At the end of the year, they
distributed the profit equally. The profit for the year was ₹ 1,20,000. The adjustment entry to
rectify the error will be:
Journal
Date Particulars L.F Dr. (₹) Cr. (₹)
a) X’s Capital A/c Dr. 20,000
To Z’s Capital A/c 20,000
b) Z’s Capital A/c Dr. 20,000
To X’s Capital A/c 20,000
c) X’s Capital A/c Dr. 60,000
Y’s Capital A/c Dr. 40,000
Z’s Capital A/c Dr. 20,000
To Profit and Loss Appropriation A/c 1,00,000
d) None of these

Q15 In the absence of an agreement, partners are entitled to:

(i) Profit share in capital ratio
(ii) Commission for making additional sale
(iii) Interest on Loan & Advances by them to the them
(iv) Salary for working extra hours
(v) Interest on Capital
Choose the correct option:
a) Only (i), (iv) and (v) b) Only (ii) and (iii)
c) Only (iii) d) Only (i) and (iii)