Simi, Manu and Beena are partners in a firm sharing profits and losses in the ratio of 2:2:1. The balances of their fixed capital accounts on 1st April, 2020, were: Simi ₹ 1,00,000, Manu ₹ 1,00,000 and Beena ₹ 80,000.
Ans – b) Explanation
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Gautam, Yashica and Asma entered into a partnership on 1st April, 2022 sharing profits and losses in the ratio of 3:2:1. Gautam and guaranteed that Asma’s share of profit after allowing interest on capital @ 5% p.a. would not be less than ₹ 30,000 p.a. The capitals contributed were Gautam ₹ 3,00,000, Yashica ₹ 2,00,000 and Asma ₹ 1,00,000.
Ans – b) Explanation:- Profit after interest = 1,20,000 – 15,000 – 10,000 – 5,000 = ₹ 90,000 Asma’s Share in Profit = 90,000 * 1/6 = ₹ 15,000 Deficiency to be charged from Gautam = Asma Guaranteed Profit –…
Alia, Karan and Shilpa are partners in a firm. They withdraw ₹ 20,000 per month as follows:
Ans – b) Explanation:- 1. Calculation of Alia’s Interest on Drawings Average Month = 12 + 1/2 = 6.5 Month Interest on Alia’s Drawings = 20000 * 12 * 8% * 6.5/12 = ₹ 10,400 2. Calculation of Karan’s Interest…
X and Y started business on 1st July, 2022. Calculate the Interest on Drawings of Y @ 10% p.a. for the year ended 31st March, 2023, if he withdrew ₹ 36,000 per quarter.
Ans – c) Explanation Average Month = 7.5 + 1.5/2 = 4.5 Months Interest on Y’s Drawings = 36,000 * 3 * 10% * 4.5/12 = ₹ 4050
Pick the odd one out from the following
Ans – d) Explanation Salary due to a partner of the firm is the appropriation and is recorded in the profit and Loss Appropriation Account. On the other hand, interest on a loan of the partner, rent to the partner,…
X and Y are partners sharing profits equally. Z was manager who received salary of ₹ 8,000 p.m. and in addition commission of 5% on net profit after charging such commission. Profit for the year is ₹ 13,56,000 before charging salary. Find the total remuneration of Z.
Ans – a) Explanation:- Salary of Z = 8,000 * 12 = ₹ 96,000 Net Profit before charging Z’s commission = 13,56,000 – 8000 * 12 = ₹ 12,60,000 Z’s Commission = 12,60,000 * 5/105 = ₹ 60,000 Total Remuneration…
Net Profit of the firm with A, B and C as partners sharing profits equally had been ₹ 5,00,000. Their capitals had balances of ₹ 2,00,000 each and current accounts had balances of ₹ 50,000 (cr.), ₹ 40,000 (Cr.) and ₹ 30,000 (Dr.) respectively. The Partnership Deed allowed/charged interest on capitals and current account balances @ 10% p.a.
1. Ans -a) Explanation:- Interest on Partner’s Capital = 2,00,000 * 10% = ₹ 20,000 2. Ans – c) Explanation:- Interest on A’s Current A/c = 50,000 * 10% = ₹ 5,000 (Allowed) Interest on B’s Current A/c = 40,000…
Arif, Ravi and Ben are partners in a firm sharing profits and losses in the ratio of 6:4:1. Arif guaranteed minimum profit of ₹ 16,000 to Ben. The trading profit of the firm for the year ending 31st March, 2021, was ₹ 1,32,000.
Ans – b) Explanation:- Ben share in profit = 1,32,000 * 1/11 = ₹ 12,000 Deficiency in Share of Ben = Minimum guarantee – share in profit Deficiency in share of Ben = 16,000 – 12,000 = ₹ 4,000 Arif’s…
Under Fixed Capital Method:
Ans – c) Explanation:- Under Fixed Capital Method. The Capital accounts are divided into two accounts. 1. Partner’s Current Account 2. Partner’s Capital Account As the name suggests, Fixed Capital Method. All recurring nature transactions of partners are recorded in…
When the interest on capital is allowed to partners, Interest on Capital Account is debited and Partner’s Capital Account is credited . It is called
And – d) Explanation:- The transaction between the partners and the firm is carried out through an adjusting entry. As no cash transaction is required.