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Chapter 1 Fundamental

The document outlines accounting fundamentals for partnership firms, focusing on interest calculations for partners' capital and drawings. It includes multiple questions requiring calculations of interest on drawings at specified rates and preparation of profit and loss appropriation accounts based on given scenarios. The document serves as a guide for understanding the financial management of partnerships.

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shivshah936
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75 views2 pages

Chapter 1 Fundamental

The document outlines accounting fundamentals for partnership firms, focusing on interest calculations for partners' capital and drawings. It includes multiple questions requiring calculations of interest on drawings at specified rates and preparation of profit and loss appropriation accounts based on given scenarios. The document serves as a guide for understanding the financial management of partnerships.

Uploaded by

shivshah936
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Chapter-1

Fundamentals- Accounting For a partnership Firm


Topic Covered: Interest on Capital, Interest on Drawing, Profit and Loss Appropriation
Account
Time: 45 minutes Marks: 20
Q 1. A, B and C are partners in a firm. You are informed that: (3)
a) A draws Rs. 10,000 from the firm in the beginning of every month.
b) B draws Rs. 10,000 from the firm at the end of every month, and
c) C draws Rs. 10,000 from the firm in the middle of every month.
Interest on drawings is to be charged @8% p.a. Calculate interest on partner’s drawings.
Q 2. P, Q, R are partners in a firm, you find that: (3)
a) P drew Rs. 6,000 in the beginning of every month for 6 months ending 31 st March, 2024.
b) Q drew Rs. 6,000 at the end of every month for 6 months ending 31st March, 2024
c) R drew Rs. 6,000 at the middle of every month for 6 months ending 31st March, 2024.
Calculate interest on drawing @ 8% p.a.
Q 3. A and B share profits in the ratio of 3:2. Their drawings for the year ending 31st March,
2023 were as under: (4)

A Rs. B Rs.
1stMay, 2022 6,000 1st April, 2022 5,000
th
30 November, 2022 8,000 st
31 August, 2022 6,000
31st January, 2023 7,000 31st October, 2022 4,000
1st February, 2023 2,000
31st March, 2023 3,000

Calculate interest on drawings @ 15% p.a. for the year ended on 31st March, 2023.
Q 4. Amit and Rahul entered into partnership on 1st April, 2022, contributing Rs. 5,00,000 and
Rs. 4,00,000 respectively. Rahul also introduced Rs. 1,00,000 as additional capital on 1st July,
2022. They agreed to share profits and losses equally. Following information is provided
regarding the partnership:
a) Amit and Rahul, each are allowed a salary of Rs. 3,000 per month.
b) Interest is to be allowed on capitals @ 8% p.a. and charged on drawings at 10% p.a.
Drawings of Amit and Rahul during the year were Rs. 12,000 and Rs. 10,000 respectively. Profit
as at 31st March, 2023 before the above mentioned adjustments was Rs. 2,50,000.
Prepare the profit and loss Appropriation Account. (4)
Q 5. On 1st April, 2023 A and B commenced business with Capitals of Rs. 6,00,000 and Rs.
4,00,000 respectively. On 31st March, 2024 the net profit (before taking into account the
provisions of deed) was Rs. 3,00,000. Interest on capitals is to be allowed at 6% p.a. B was
entitled to a salary of Rs. 60,000 p.a. The drawings of the partners A and B were Rs. 60,000 and
Rs. 40,000 respectively. The interest on Drawings for A being Rs. 2,000 and B Rs. 1,000.
Assuming that A and B are equal partners.
Prepare the Profit and Loss Appropriation Account and Partner’s Capital Account if capitals are
fixed. (6)

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