CBSE Questions for Class 12 Commerce Accountancy Accounting For Partnership: Basic Concepts Quiz 12 - MCQExams.com

If a fixed amount is withdrawn on the last day of every quarter of a calendar year, the interest on the total amount of drawings will be calculated for __________.
  • 4.5 months
  • 5.5 months
  • 6 months
  • 6.5 months
A, B and C were capitals of Rs. 50,000; Rs. 40,000 and Rs. 30,000 respectively carrying on business in partnership. The firm's reported profit for the year was Rs. 79,As per provisions 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 Rs. 20,000, in addition to his capital contribution? 
  • Rs. 26,000 for the partner B and C & Rs. 27,200 for partner A.
  • Rs. 26,400 each partner
  • Rs. 33,000 for A, Rs. 26,400 and Rs. 19,800 for C.
  • None of these
Interest on capital will be paid to the partners if provided for in the agreement but only from __________. 
  • profits
  • reserves
  • accumulated profits
  • goodwill
Partners are supposed to pay interest on drawings only when ______ by the _________. 
  • Provided, agreement
  • Permitted, Investors
  • Agreed, partners
  • A & C above 
What time would be taken into consideration if equal monthly amount is drawn as drawing at the beginning of each month? 
  • 7 months
  • 6 months
  • 5 months
  • 6.5 months
Where will you record interest on drawings? 
  • Debit side of Profit & Loss Appropriation Account. 
  • Credit side of Profit & Loss Appropriation Account. 
  • Credit side of Profit & Loss Account. 
  • Debit side of Capital/Current Account only. 
When Profit & Loss Appropriation Account is prepared? 
  • For proprietorship. 
  • For partnership firm. 
  • Both A and B 
  • None of the above. 
X, Y and Z are partners in a firm. At the time of division of profit for the year, there was a dispute between the partners. Profits before interest on partners' capital were Rs.12,X wanted interest on capital @ 20% as his capital contributions were Rs. 2,00,000 as compared to that of Y and Z which was Rs. 1,50,000 and Rs. 1,00,000 respectively. Calculate amounts payable to X, Y and Z. 
  • Profits of Rs. 12,000 will be distributed equally.
  • X will get the interest of Rs.40,000 and loss of Rs.28,000 will be shared equally.
  • All the partners will get interest on capital and the loss of Rs. 78,000 will be shared equally.
  • None of these
X and Y are partners sharing profits and losses in the ratio 4:Z was manager who received the salary of Rs.8,000 p.m. in addition to a commission of 5% on net profits after charging such commission. Profits for the year is Rs. 13,56,000 before charging salary. Find the total remuneration of Z? 
  • Rs. 1,56,000
  • Rs. 1,76,000
  • Rs. 1,74,000
  • Rs. 1,52,000
When the interest on drawings is charged to partners, interest on drawing account is credited, and partner's capital account is debited. It is called __________. 
  • an opening entry
  • a closing entry
  • an adjusting entry
  • an transfer entry
X and Y are partners sharing profits and losses in the ration of 3:2 having the capital of Rs. 1,60,000 and Rs. 1,00,000 respectively. They are entitled to 9% p.a. interest on capital before distributing the profits. During the year firm earned Rs.15,600 before allowing any interest on capital. Profits apportioned among X and Y is ___________. 
  • Rs. 9,360 and Rs. 6,240
  • Rs. 9,600 and Rs. 6,000
  • Rs. 10,000 and Rs. 5,600
  • None of these
Fluctuating Capital Account is credited with:
  • Interest on capital
  • Profit of the year
  • Remuneration to the partners
  • All of these
X, Y and Z are partners in a firm. At the time of division of profit for the year, there was a dispute between the partners. Profits before interest on partner's loan were Rs. 12,000 and Y determined interest @ 24% p.a. on his loan of Rs.1,60,There was no agreement on this point. Calculate the amount payable to X, Y and Z respectively.
  • Rs. 4,000 to each partner.
  • Loss of Rs. 8,800 for X and Z & Y will take home Rs. 25,600.
  • Rs. 800 for X, Rs. 10,400 for Y and Rs. 800 for Z.
  • Rs. 4,800 to each partner.
To constitute a partnership agreement, it _____________.
  • Must be in writing
  • Can be oral or written
  • Either oral or written
  • Only oral
X, Y and Z are partners in a firm. At the time of division of profit for the year, there was a dispute between the partners. Profits before interest on partner's capital were Rs.12,000 and Z demanded a minimum profit of Rs. 10,000 as his financial position was not good. However, there was no written agreement on this profit. Calculate the amount payable to X, Y and Z. 
  • Other partners will pay Z the minimum profit and will suffer loss equally.
  • Other partners will pay Z the minimum profit and will suffer loss in capital ratio.
  • X, Y will take Rs. 1,000 each and Z will take Rs. 10,000.
  • Rs. 4,000 to each of the partners.
If profit sharing ratio is not specified in the partnership deed, then the profit is shared ______.
  • Equally
  • According to the seniority of age
  • According to capital contribution
  • According to qualification.
Partnership agreement can be __________.
  • Oral
  • Written
  • Oral or written
  • None of these
Ram is a partner. He made drawing as follows:
July 1Rs.200
August 1Rs.200
September 1Rs.300
November 1Rs.50
February 1Rs.100
If the rate of interest on drawings is 6% and accounts are closed on March 31 the interest on drawing is:
  • Rs. 29.75
  • Rs. 35
  • Rs. 30
  • Rs. 40
A Drawn Rs.1000 per month on the last day of every month. If the rate of interest is 5% p.a. then the total interest or drawings will be:
  • Rs. 325
  • Rs. 275
  • Rs. 300
  • Rs. 350
Which of the following is not covered by the term "property of the firm"?
  • Property and rights and interest in property originally brought into the stock of the firm
  • Property acquired by or for the firm
  • Goodwill of the business
  • Property of the partners
Share in partnership can be transferred by consent of ______ the partners.
  • All
  • Majority
  • No consent required
  • None of these
Ajay and Vijay are partners in a firm. They share profits in the ratio of 3:As per their partnership agreement, interest on drawings is to be charged @ 10% p.a. Their drawings during 2017 were Rs 24,000 and Rs 16,000, respectively. Calculate interest on drawings based on the assumption that the amounts were withdrawn evenly, throughout the year.
  • Rs 1,200 and Rs 800
  • Rs 1,500 and Rs 900
  • Rs 1,800 and Rs 1,200
  • Rs 1,000 and Rs 600
As per section 37 of the Indian Partnership Act 1932, the executors would be entitled at their choice to the interest calculated from the date of death till the date of payment on the final amount due to the deceased partner at _______ % p.a.:
  • 7
  • 4
  • 6
  • 12
In the absence of an agreement to the contrary, the partners are :
  • Entitled to $$6\%$$ p.a. interest on their capitals only when there are profits
  • Entitled to $$9\%$$ p.a. interest on their capitals only when there are no profits
  • Entitled to interest on capital at the bank rate only when there are profits
  • Not entitled to any interest on their capitals
Ram and Mohan, are partners. They Draw for private use Rs. 6,000 and Rs. 4000 respectively. Interest is chargeable @ 6% per annum on drawings. What is the interest?
  • Ram Rs. 180 and Mohan Rs. 120
  • Ram Rs. 360 and Mohan Rs. 240
  • Ram Rs. 30 and Mohan Rs. 20
  • None
A and B are partners having capital of Rs. 50,000 and Rs. 60,000 respectively. Interest on capital is given @ 5% p. a. Profits for the year before the appropriation is Rs. 4.600 provide interest on capital out of profits. Interest allocated to partners is:
  • Rs. 3,000 and Rs. 2,500
  • Rs. 2,091 and Rs. 2,509
  • Rs. 2,500 and Rs. 2,091
  • Rs. 600 and Rs. 300
State whether the following statement is True or False.
The interest on capital is an income of the firm.
  • True
  • False
A and B are Partners sharing profits in the ratio of 3:2 with capitals of Rs. 50,000 and Rs. 30,000 respectively. Interest on capital is agreed @ 6% p.a. B is to be allowed an annual salary of Rs. 2,During 2016, the profits of the year prior to calculation of interest on capital but after charging B's salary amounted to Rs. 12,Calculate the amount of profits to be distributed to A and B after the above effect.
  • A's Profit Rs. 4,389; B's Profit Rs. 2,926
  • A's Profit Rs. 4,620; B's Profit Rs. 3,080
  • A's Profit Rs. 4,000; B's Profit Rs. 3,000
  • A's Profit Rs. 4,300; B's Profit Rs. 2,900
Calculate the interest on drawings of Ram @ 10% p.a. for the year ended 31st March 2017, If he withdrew Rs 3,000 at the end of every month. Assuming that drawings were made evenly throughout the year.
  • Rs 1,850
  • Rs 1,650
  • Rs 1.250
  • Rs 1,350
M and N are partners in a firm. M has given a loan of Rs. 8,000 to the firm on 1st July,The partnership deed is silent upon the question of provision of interest on partner's loan. Compute the amount of interest payable on the loan advanced by M to the firm, assuming the books are closed on 31st March each year.
  • Rs. 460
  • Rs. 360
  • Rs. 560
  • Rs. 480
John, a partner in Modern Tours and Travels withdrew money during the year ending March 31, 2016 from his capital account, for his personal use. Calculate interest on drawings, if rate of interest is 9 per cent per annum.  If an amount of Rs. $$3,000$$ per month was withdrawn by him at the end of each month.
  • Rs. $$1,580$$
  • Rs. $$2,355$$
  • Rs. $$1,955$$
  • Rs. $$1,485$$
Kiran, a partner in a firm, withdrew money from his capital account during the year ended 31, MarchIf the amounts withdrawn were: Rs. $$12,000$$ on June 01, 2015, Rs. $$8,000$$; on August 31, 2015, Rs. $$3,000$$; on September 30, 2015, Rs. $$7,000$$, on November 30, 2015, and Rs. $$6,000$$ on January 31,Calculate interest in drawings, if rate of interest is $$9$$ per cent per annum.
  • Rs. $$1,800$$
  • Rs. $$2,400$$
  • Rs. $$1,755$$
  • Rs. $$1,585$$
John, a partner in Modern Tours and Travels withdrew money during the year ending March 31, 2016 from his capital account, for his personal use. Calculate interest in drawings if rate of interest is $$9$$ per cent per annum and If he withdrew Rs. $$3,000$$ per month at the beginning of the month.
  • Rs. $$1,485$$
  • Rs. $$2,845$$
  • Rs. $$1,755$$
  • Rs. $$1,580$$
Kamal and Vimal are partners in a firm. They share profits equally. Their monthly drawings are Rs 2,000 each. Interest on drawings is to be charged at 10% p.a. Calculate interest on Kamal and Vimal's drawings for the year 2016, assuming that amount is withdrawn in the beginning of every month.
  • Rs 1,300 and Rs 1,100
  • Rs 1,200 and Rs 1,200
  • Rs 1,100 and Rs 1,100
  • Rs 1,300 and Rs 1,300
Harish is a partner in a firm. He withdrew the following amounts during the year 2017:
May 1 -                      4,000
August 1 -                10,000
September 30 -         4,000
January 31 -            12,000
March 31 -                 4,000

Interest on drawings is to be charged @ 7.5% p.a. Calculate the amount of interest to be charged on Harish's drawing for the year ending March 31, 2018.  
  • Rs. 1,100
  • Rs. 1,125
  • Rs. 1,075
  • Rs. 1,200
A, B, and C are partners sharing profits in the ratio of $$ 5:3:2.$$ They decide to share the future profits in the ratio of 2:3:5 with effect from $$1st$$ April,What will be accounting treatment of Workmen Compensation Reserve appearing in the Balance Sheet on that date when no information is available for the same?
  • Distributed among the partners in their in their capital ratio.
  • Distributed among the partners in their new profit-sharing ratio.
  • Distributed among the partners in their old profit-sharing ratio.
  • Carried forward to new Balance Sheet.
X, Y and Z are partners sharing profits in the ratio of $$ 5:3:2.$$ They decide to share future profits in the ratio of $$2:3:5$$ with effect from $$1^{st}$$ April, $$2018$$ . They also decide to record the effect of following revaluation without affecting the book values of assets and liabilities, by passing single adjusting entry :
Book Value (Rs.)Revised Value (Rs.)
Land and Building 3,00,0004,50,000
Plant and Machinery4,50,0004,20,000
Trade Creditors1,50,0001,35,000
Outstanding Rent 1,35,0001,80,000
The necessary single adjustment entry will be:
  • Dr. Z and Cr. X by Rs. 27,000.
  • Dr. X and Cr. Z by Rs. 27,000.
  • Dr. Y and Cr. X by Rs. 27,000.
  • Dr. X and Cr. X by Rs. 27,000.
Amit and Vijay started a partnership business on 1st AprilTheir capital contributions were Rs. 2,00,000 and Rs. 1,50,000 respectively. The Partnership Deed provided that:
(a) Interest on capital be allowed @ 10% p.a.
(b) Amit to get a salary of 2,000 per month and Vijay 3,000 per month.
(c) Profits are to be shared in the ratio of 3 :
Profit for the year ended 31st March 2018 before above appropriations was Rs. 2,16,Interest on drawings amounted to Rs. 2,200 for Amit and Rs. 2,500 for Vijay. Which account is prepared to give effect to the above transaction ?
  • Profit and Loss apprpriation account
  • Partners Capital Account
  • Both A & B
  • None of these
Indian Partnership Act was passed in the year _________.
  • 1956
  • 1936
  • 1932
  • 1930
Cost of abnormal wastage is _________________.
  • Charged to the product cost
  • Charged to the profit & loss account
  • charged partly to the product and partly profit & loss account
  • not charged at all
Partnership may come into existence by ________________.
  • The operation of law
  • An express agreement only
  • An express or implied agreement only
  • Inheritance of property
The interest on partner's capital accounts is to be credited to_________. 
  • partner's capital Accounts
  • profits and loss Accounts
  • interest account
  • all of these
Furniture of the book value of Rs.1,500 was sold for Rs.600 and new fixture of Rs.1,000 was purchased and cartage of Rs.25 paid.What is the amount of capital expenditure?
  • Rs. 1,500
  • Rs. 900
  • Rs. 1,000
  • Rs. 1,025
If any partner has advanced some money to the firm beyond the amount of his capital for the purpose of business, he shall be entitled to get an interest on the amount at the rate of _____ percent per annum.
  • 3
  • 4
  • 5
  • 6
The capital in a business on Jan. 1 and Jan 31 is Rs. 17,000 and Rs. 17,200 respectively. Investment by owner and withdrawal by owner during Jan. Amount to Rs. 1000 and Rs. 700 respectively. What is the net income for January?
  • Rs. 100(Loss)
  • Rs. 300
  • Rs. 200
  • Rs. 500
Which of the following is/are important feature(s) of a partnership?
  • Mutual agreement
  • Sharing of profits
  • Business shall be carried on by all or any one of them acting for all
  • All of the above
A, B, C and D are partners sharing profits and losses in the ratio of 3 : 3 : 2 :The partnership is dissolved and D becomes insolvent. C brings only the share of loss and shows his inability toI contribute anything towards D's deficiency. According to Garner vs. Murray ruling, D's deficiency in total will be shared by _____________________.
  • A and B in the ratio of their capitals
  • A, B and C in the profit sharing ratio
  • A, B and C in their capital ratio
  • A, B and C equally
A, a partner in a firm, is driving Rs.500 regularly on the 16th of every month. He will have to pay interest at the given rate in a year on Rs.6000 for the total period of __________.
  • 5 months
  • 6 months
  • 7 months
  • 12 months
A, B, C and D are partners sharing profits in the ratio of 5 : 4 : 3 : 2. 
A retires and B, C and D decide to share profits and losses equally in future. What is the gaining ratio ?
  • Equal
  • 2 : 7 : 6
  • 5 : 2 : 8
  • 2 : 5 : 8
Following are the essential elements of a partnership, except ______________.
  • at least two persons
  • there is an agreement between all partners
  • equal share of profit and losses
  • partnership agreement for some business
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