DELHI PUBLIC SCHOOL JALANDHAR

SUBJECT :ACCOUNTANCY CLASS :XII B

DATE:19-4-2023 ASSIGNMENT 1

TOPIC: PARTNERSHIP FUNDAMENTALS

1.Read the following hypothetical situation and answer the given questions, on the basis of the given
information:

Kavita, Savita and Madhu were partners in a firm with capitals of 6,00,000, 4,00,000 and 2,00,000
respectively. After providing interest on capital @ 10% p.a., the profits are divisible as follows:
Kavita 1/3 ; Savita 1 /2 ; and Madhu 1/6. Kavita personally guaranteed that Savita's share of profit after
charging interest on capital would not be less than 1,00,000 in any year.The profit for the year ending 31st
March, 2022 amounted to 3,00,000 before providing interest on capital.
(i)The total profits of the firm after adjustment of guaranteed amount will be distributed between the partners
as:

(a) Kavita 60,000, Savita 40,000 and Madhu 20,000

(b) Kavita 50,000, Savita 1,00,000 and Madhu 30,000

(c) Kavita 60,000, Savita 90,000 and Madhu 30,000

(d) Kavita 60,000, Savita 1,00,000 and Madhu 20,000

(ii)Savita's share of profit is short of the guaranteed amount by:

(a) 40,000 (b) 70,000 (c ) 20,000 (d) 10,000 [C.B.S.E.2023]

2.Hina and Neena are partners in a firm. Neena withdrew 10,000 per month at the beginning of each month
during the year ended 31st March, 2022. Interest on drawings was to be charged @ 6% per annum. Calculate
interest on Drawings of partner Neena. [C.B.S.E.2023]

3.Vibha and Asha are partners in a firm. Asha withdrew 1,000 at the end of each quarter during the year ended
31st March, 2022. Interest on drawings will be calculated for an average period of___________months.
[C.B.S.E.2023]
4. Assertion (A):- Commission provided to partner is shown in Profit and Loss A/c.
Reason (R):- Commission provided to partner is charge against profits and is to be provided at fixed
rate.
a) (A) is correct but (R) is wrong
b) Both (A) and (R) are correct, but (R) is not the correct explanation of (A)
c) Both (A) and (R) are incorrect.
Both (A) and (R) are correct, and (R) is the correct explanation of (A)

5. Mohan and Shyam are partners in a firm. State whether the claim is valid if the partnership agreement is

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silent in the following matters:
(i) Mohan is an active partner. He wants a salary of ₹10,000 per year.
(ii) Shyam had advanced a loan to the firm. He claims interest @10% p.a.
(ii) Mohan has contributed ₹ 20,000 and Shyam ₹ 50,000 as capital.Mohan wants equal share in profits.
(iv) Shyam wants interest on capital to be credited @ 6% per annum.
6. State whether the following statements are true or false:
(i) Valid partnership can be formulated even without a written agreement between the partners.
(ii) Each partner carrying on the business is the principal as well as the agent.
(iii) Methods of settlement of dispute among the partners can't be part of the partnership deed.
(iv) If the deed is silent, interest at the rate of 6% p.a. would be charged on the drawings made by thepartner.
7..A and B are partners sharing profits and losses in the ratio of 3:2. Their capital accounts showed balances
of ₹1,50,000 and ₹ 2,00,000 respectively on April 1,2022. Show the treatment of interest oncapital for the
year ending 31 March,2023, in each of the following alternatives:
i. If the partnership deed is silent as to the payment of interest on capital and the profit
for the year is ₹ 50,000;
ii. If partnership deed provides for interest on capital @ 8% p.a. and the firm
incurred a lossof ₹ 10,000 during the year;
iii. If partnership deed provides for interest on capital @ 8% p.a. and the firm earned a
profit of ₹ 50,000 during the year;
iv. If the partnership deed provides for interest on capital @ 8% p.a. and the firm earned a
profit of ₹ 14,000 during the year.
Hint: In the absence of any information interest on capitals will be appropriation of profit.
8.Ram, Mohan and Sohan are partners with capitals of ₹ 5, 00,000, ₹ 2, 50,000 and ₹ 2, 00,000 respectively.
After providing interest on capital @10% p.a. the profits are divisible as follows: Ram1/2, Mohan 1/3 and
Sohan 1/6. Ram and Mohan have guaranteed that Sohan's share in the profit shall not be less than ₹ 25, 000, in
any year.The net profit for the year ended March 31, 2016 is₹ 2, 00,000, before charging interest on capital.You
are required to show distribution of profit.
5.The net profit of X, Y and Z for the year ended 31st March, 2021 was ₹ 60, 000 and the same wasdistributed
among them in their agreed ratio of 3:1:1. It was subsequently discovered that the undermentioned transactions
were not recorded in the books:
(i) Interest on Capital @ 5% p.a.
(ii) Interest on drawings amounting to X ₹ 700, Y ₹ 500 and Z ₹ 300.
(iii) Partner's Salary: X ₹1, 000, Y ₹1,500 p.a.
The capital accounts of partners were fixed as: X ₹ 1, 00,000, Y ₹ 80, 000and Z ₹ 60, 000.
Record the adjustment entry.
9. Rakshit and Malik are partners in a firm sharing profits and losses in the ratio of 4: 1. On 1st April, 2021,
their capitals were 1,20,000 and 80,000 respectively. On 1st December, 2021, they decided that the total
capital of the firm should be 3,00,000 to be contributed by them in the ratio of 2: 1. According to the
partnership deed, interest on capital is allowed to the partners @ 6% p.a.

Calculate interest on capital to be allowed for the year ending 31st March, 2022. [C.B.S.E. 2023]

10. Ajay, Manish and Sachin were partners sharing profits in the ratio 5:3:2. Their Capitals were ₹
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 6,00,000; ₹ 8,00,000 and ₹ 11,00,000 as on April 01, 2021. As per Partnership deed, Interest on
Capitals were to be provided @ 10% p.a. For the year ended March 31, 2022, Profits of ₹ 2,00,000
were distributed without providing for Interest on Capitals.
Pass an adjustment entry and show the workings clearly