CBSE Class 12 Accountancy Accounting For Partnership Firms MCQs Set C

(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.

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?

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

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

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

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

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

Question. X and Y are partners sharing profits and losses in the ratio of 3 : 2 having fixed capitals 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

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.

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

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

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

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

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

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

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

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  

[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

Answer: C

[Question. 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: 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

Answer: A

[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

Answer: C

[Question. Vikas is a partner in a firm. His drawings during the year ended 31st March, 2019 were Rs. 72,000. If interest on drawings is charged @ 9% p.a. the interest charged will be :

(a) Rs.324

(b) Rs.6,480

(c) Rs.3,240

(d) Rs.648

Answer: C

[Question. 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) 6 ½

(c) 5 ½

(d) 12

Answer: B

[Question. X, Y and Z are partners in the ratio of 4 : 3 : 2. Salary to X Rs. 15,000 and to Z Rs.3,000 omitted and profits distributed. For rectification, now X will be credited :

(a) Rs. 15,000

(b) Rs.1,000

(c) Rs. 12,000

(d) Rs. 7,000

(viii) Guarantee of Profit to a Partner

Answer: D

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.

Answer: C

Question:  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: B

Question:  Anuradha is a partner in a firm. She withdrew Rs.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) Rs.900

(b) Rs. 1,200

(c) Rs. 1,500

(d) Rs.600

Answer: C

Question:  Which item is recorded on the credit side of partner’s current accounts :

(a) Interest on Partner’s Capitals

(b) Salaries of Partners

(c) Share of profits of Partners

(d) All of the Above

Answer: D

Question:  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: C

Question:  On 1st June, 2018 a partner introduced in the firm additional capital Rs. 50,000. In the absence of partnership deed, on 31st March, 2019 he will receive interest:

(a) Rs.3,000

(b) Zero

(c) Rs.2,500

(d) Rs. 1,800

Answer: B

Question:  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: 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

Answer: 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)

Answer: D

Question:  For the firm interest on capital is :

(a) Capital Payment

(b) Capital Receipt

(c) Loss

(d) Income

Answer: C

Question:  Y is a partner in a firm. He withdrew regularly Rs.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) Rs.375

(b) Rs.450

(c) Rs.525

(d) Rs.900

Answer: A

Question:  Z is a partner in a firm. He withdrew regularly Rs.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) Rs.480

(b) Rs.280

(c) Rs.200

(d) Rs.240

Answer: D

Question:  X and Y are partners in the ratio of 3 : 2. Their capitals are Rs.2,00,000 and Rs. 1,00,000 respectively. Interest on capitals is allowed @ 8% p.a. Firm earned a profit of Rs. 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 Rs. 16,000; Y Rs.8,000

(b) X Rs.9,000; Y Rs.6,000

(c) X Rs. 10,000; Y Rs.5,000

(d) No Interest will be allowed

Answer: A

Question:  X and Y are partners in the ratio of 3 : 2. Their capitals are Rs.2,00,000 and Rs. 1,00,000 respectively. Interest on capitals is allowed @ 8% p.a. Firm incurred a loss of Rs.60,000 for the year ended 31st March 2019. Interest on Capital will be:

(a) X Rs. 16,000; Y Rs.8,000

(b) X Rs.8,000; Y Rs.4,000

(c) X Rs. 14,400; Y Rs.9,600

(d) No Interest will be allowed

Answer: D

Question:  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: B

Question:  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: B

Question:  X, Y and Z are partners in the ratio of 6 : 4 : 1. In the firm X has guaranteed Z for his minimum profit of Rs. 15,000. Firm’s profit was Rs.99,000. In the firm profit X’s share will be:

(a) Rs.30,000

(b) Rs. 15,000

(c) Rs.48,000

(d) Rs.45,000

Answer: C

Question:  P, Q and R are partners in 3 : 2 : 1. R is guaranteed that his share of profit will not be less than Rs.70,000. Any deficiency will be borne by P and Q in the ratio of 2 : 1. Firm’s profit was Rs.2,40,000. Share of P will be :

(a) Rs. 1,00,000

(b) Rs. 1,10,000

(c) Rs. 1,20,000

(d) Rs. 1,02,000

Answer: A

Question:  Ajay is a partner in a firm. He withdrew Rs.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) Rs.990

(b) Rs. 1,080

(c) Rs. 1,170

(d) Rs.2,160

Answer: A

Question:  Sushil is a partner in a firm. He withdrew Rs.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) Rs.2,080

(b) Rs. 1,760

(c) Rs.3,840

(d) Rs. 1,920

Answer: D

Question:  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 for all as an agent.

(d) All of the above.

Answer: D

Question:  Following are essential elements of a partnership firm except:

(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: C

Question:  Number of partners in a partnership firm may be :

(a) Maximum Two

(b) Maximum Ten

(c) Maximum One Hundred

(d) Maximum Fifty

Answer: D

Question:  Liability of partner is :

(a) Limited

(b) Unlimited

(c) Determined by Court

(d) Determined by Partnership Act

Answer: B

Question:  P, Q and R sharing profits in the ratio of 2 : 1 : 1 have fixed capitals of Rs.4,00,000, Rs.3,00,000 and Rs.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 Rs. 1,000; Dr. Q Rs.1,500 and Cr. R Rs.500

(b) Dr. P Rs.500; Cr. Q Rs. 1,500 and Dr. R Rs. 1,000

(c) Cr. R. Rs.500; Dr. Q Rs. 1,500 and Cr. R Rs. 1,000

(d) Dr. P Rs. 1,000; Cr. Q Rs. 1,500 and Dr. R Rs.500

Answer: D

Question:  A, B and C sharing profits in the ratio of 2 : 2 : 1 have fixed capitals of Rs.3,00,000, Rs.2,00,000 and Rs. 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 Rs. 1,200; Dr. B Rs.800 and Dr. C Rs.400

(b) Dr. A Rs. 1,200; Cr. B Rs.800 and Cr. C Rs.400

(c) Cr. A Rs.800; Cr. B Rs.400 and Dr. C Rs. 1,200

(d) Dr. A Rs.800; Dr. B Rs.400 and Cr. C Rs.1,200

Answer: B

Question:  P and Q are partners sharing profits in the ratio of 1 : 2. R was manager who received the salary of Rs. 10,000 p.m. in addition to commission of 10% on net profits after charging such commission. Total remuneration to R amounted to Rs. 1,80,000. Profit for the year before charging salary and commission was :

(a) Rs.7,20,000

(b) Rs.6,00,000

(c) Rs.7,80,000

(d) Rs.6,60,000

Answer: C

Question:  Anu and Tanu are equal partners with fixed capitals of Rs.2,00,000 and Rs. 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 Rs. 16,000 and Tanu will be credited by Rs.8,000

(b) Anu will be debited by Rs. 16,000 and Tanu will be debited by Rs.8,000

(c) Anu will be credited by Rs.4,000 and Tanu will be debited by Rs.4,000

(d) Anu will be debited by Rs.4,000 and Tanu will be credited by Rs.4,000

Answer: C

Question:  Asha and Vipasha are equal partners with fixed capitals of Rs.5,00,000 and Rs.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 Rs. 1,500 and Vipasha will be credited by Rs. 1,500;

(b) Asha will be credited by Rs. 1,500 and Vipasha will be debited by Rs. 1,500;

(c) Asha will be debited by Rs.5,000 and Vipasha will be debited by Rs.2,000;

(d) Asha will be credited by Rs.5,000 and Vipasha will be credited by Rs.2,000;

Answer: A

Question:  Net profit of a firm is Rs.79,800. Manager is entitled to a commission of 5% of profits after charging his commission. Manager’s Commission will be:

(a) Rs.4,200

(b) Rs.380

(c) Rs.3,990

(d) Rs.3,800

Answer: D

Question:  A, B and C are partners. A’s capital is Rs.3,00,000 and B’s capital is Rs.1,00,000. C has not invested any amount as capital but he alone manages the whole business. C wants Rs.30,000 p.a. as salary. Firm earned a profit of Rs.1,50,000. How much will be each partner’s share of profit:

(a) A Rs.60,000; B Rs.60,000; C Rs.Nil

(b) A Rs.90,000; B Rs.30,000; C Rs.Nil

(c) A Rs.40,000; B Rs.40,000 and C Rs.40,000

(d) A Rs.50,000; B Rs.50,000 and C Rs.50,000.

Answer: D

Question:  A, B and C are partners in the ratio of 5: 3: 2. Before B’s salary of Rs. 17,000 firm’s profit is Rs.97,000. How much in total B will receive from the firm?

(a) Rs. 17,000

(b) Rs.40,000

(c) Rs.24,000

(d) U 1,000

Answer: D

Question:  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: D