Half yearly Exam

Class , 12 accountancy

General Instructions:

1.. Q.no 1 to 20 are 1 marks.

2.. Q.no 21 to 26 are 3 marks.

3.. Q.no 27 to 29 are 4 marks..

4.. Q.no 30 to 34 are 6 marks..

1.. Which of the following is a key feature of a partnership?

a) Limited liability b) Separate legal entity

c) Mutual agency d) Limited life

2.. A minor can be admitted into a partnership:

a) As a partner with full rights

b) As a partner with limited rights c) For profits only

d) Not at all

3.. On 1st June 2018 a partner introduced in the firm additional capital ₹50,000. In the
absence of partnership deed, on 31st March 2019 he will receive interest :
(A) ₹3,000 (B) Zero
(C) ₹2,500 (D) ₹1,800

4.. Is rent paid to a partner appropriation of profits?

(A) It is appropriation of profit
(B) It is not appropriation of profit
(C) If partner’s contribution as capital is maximum
(D) If partner is a working partner

5…Ram and Shyam are partners in the ratio of 3 : 2. Before profit distribution, ‘ Ram is
entitled to 5% commission of the net profit (after charging such commission). Before
charging commission, firm’s profit was ₹42,000. Shyam’s share in profit will be :
(A) ₹16,000 (B) ₹24,000
(C) ₹26,000 (D) ₹16,400
6.. The term “super profit” means_______

A….Extra profit earned

B…Profit earned in abnormal circumstance

C…Excess of average profit over normal profit

D…Average profit earned by similar companies

7… A and B share profits in the ratio of 2 : 1. C is admitted with 1/4 share in profits. C

acquires 3/4 of his share from A and 1/4 of his share from B. The new ratio will be:
(A) 2 : 1 : 1 (B) 23 : 13 : 12
(C) 3 : 1 : 1 (D) 13 : 23 : 12
8.. A, B and C are partners sharing in the ratio of 5 : 4 : 3. They admit D for 17th share. It
is agreed that B would retain his original share. Sacrificing ratio will be :
(A) A, B and C — 5 : 4 : 3 (B) A and C — 4 : 3
(C) A and C — 5 : 4 (D) Z and C — 5 : 3
9.. . A and B share profits and losses equally. They have ₹20,000 each as capital. They
admit C as equal partner and goodwill was valued at ₹30,000. C is to bring in ₹30,000 as
his capital and necessary cash towards his share of goodwill. Goodwill Account will not
remain open in books. If profit on revaluation is ₹13,000, find the closing balance of the
capital accounts.
(A) ₹31,500; ₹31,500; ₹30,000 (B) ₹31,500; ₹31,500; ₹20,000
(C) ₹26,500; ₹26,500; ₹30,000 (D) ₹20,000; ₹20,000; ₹30,000
10.. What journal entry will be recorded for writing off the goodwill already existing in
Balance Sheet at the time of retirement of a partner?
(A) Retiring Partner’s Capital A/c Dr. To Goodwill A/c
(B) All Partner’s Capital A/cs (including retiring) Dr. (in old ratio) To Goodwill A/c
(C) Remaining Partner’s Capital A/cs Dr. (in gaining ratio) To Goodwill A/c
(D) Remaining Partner’s Capital A/cs Dr. (in new ratio) To Goodwill A/c

11.. What journal entry will be recorded for deceased partner’s share in profit from the
closure of last balance sheet till the date of his death?
(A) Profit and Loss A/c To Deceased Partner’s Capital A/c Dr.
(B) Deceased Partner’s Capital A/c To Profit and Loss A/c Dr.
(C) Deceased Partner’s Capital A/c To Profit and Loss Suspense A/c Dr.
(D) Profit and Loss Suspense A/c To Deceased Partner’s Capital A/c Dr.

12.. . P, Q and R have been sharing profits and losses in the ratio of 5 : 3 : 2. Q retires.
His share is taken by P and R in the ratio of 2 : 1. New profit sharing ratio will be:
(A) 6 : 4 (B) 7 : 3
(C) 7 : 2 (D) 6 : 3

13.. A, B and C were partners in a firm sharing profits and losses in the ratio of 2 : 2 : 1.
The capital balance are ₹50,000 for A, ₹70,000 for B, ₹35,000 for C. B decided to retire
from the firm and balance in. reserve on the date was ₹25,000. If goodwill of the firm
was valued at ₹30,000 and profit on revaluation was ₹7,500 then, what amount will be
payable to B:-
(A) ₹70,820 (B) ₹76,000
(C) ₹75,000 (D) ₹95,000

14.. . P, Q and R are sharing profits and losses equally. R retires and the goodwill is
appearing in the books at ₹30,000. Goodwill of the firm is valued at . ₹1,50,000.
Calculate the net amount to be credited to R’s Capital A/c.
(A) ₹60,000 (B) ₹50,000
(C) ₹40,000 (D) ₹10,000

15.. A, B and C were partners sharing profit or loss in the ratio of 7 : 3 : 2. From Jan.
1,2019 they decided to share profit or loss in the ratio of 8 : 4 : 3. Due to change in the
profit-loss sharing ratio, B’s gain or sacrifice will be :
(A) Gain 1/60 (B) Sacrifice 1/60
(C) Gain 2/60 (D) Sacrifice 3/60

16.. Aran and Varan are partners sharing profits in the ratio of 4 : 3. Their Balance Sheet
showed a balance of ? 5 6,000 in the General Reserve Account and a debit balance of ?
14,000 in Profit and Loss Account. They now decided to share the future profits equally.
Instead of closing the General Reserve Account and Profit and Loss Account, it is
decided to pass an adjustment entry for the same. In adjustment entry :
(A) Dr. Aran by ₹3,000; Cr. Varan by ₹3,000
(B) Dr. Aran by ₹5,000; Cr. Varan by ₹5,000
(C) Cr. Aran by ₹5,000; Dr. Varan by ₹5,000
(D) Cr. Aran by ₹3,000; Dr. Varan by ₹3,000

17.. At the time of dissolution of firm, “Loan of partners” (Loans given by partners to
the firm) is paid out of the amount realised on sale of assets :
(A) After making the payment of loans given by third party
(B) After making the payment of balance of Capital Accounts of partners
(C) After making the payment of above (A) and (B)
(D) Before the payment of loans given by third party

18.. Change in the existing agreement between the partners is called :

(A) Dissolution of Firm (B) Dissolution of Partnership
(C) Dissolution of Business (D) All of the Above

19.. There was an Unrecorded asset of Rs.2,000 which was taken over by a partner at
Rs. 1,500. Partner’s Capital Account will be debited by
(A) ₹2,000 (B) ₹1,500
(C) ₹500 (D) ₹3,500

20.. On the basis of following data, final payment to a partner on firm’s dissolution ‘ will
be made : Debit balance of Capital Account ₹14,000; Share of his profit on realisation
₹43,000; Firm’s asset taken over by him for ₹17,000.
(A) ₹31,000 (B) ₹29,000
(C) ₹12,000 (D) ₹60,000

21.. Mukesh and Ramesh are partners sharing profits and losses in the ratio of 2 : 1
respectively. They admit Rupesh as a partner with 1/4 share in profits with a guarantee
that his share of profit shall be atleast ₹ 55,000. The net profit of the firm for the year
ending 31st March, 2013 was ₹ 1,60,000. Prepare profit and loss appropriation account.

0r

A ,Band C are partners share profit and loss in the ratio of 2;2:1 .B, retire and their capital
after adjusting goodwill and reserve worth ₹2,00,000 he took over an unrecorded
investment worth of ₹40,000 a part payment of his due and Balance paid by cheque on
the same day .Pass journal entries .

22.. A business has earned average profits of Rs. 1,00,000 during the last few years
and the normal rate of return in similar business is 10%. Find out the value of goodwill
by
(i) Capitalisation of super profit method.
(ii) Super profit method, if the goodwill is valued at 3 years’ purchase of super profit.
The assets of the business were Rs. 10,00,000 and its external liabilities Rs.1,80,000.

23.. Aditya and Balan are partners sharing profits and losses in 3:2 ratio. They admitted
Christopher for 1/4 share in the profits. The new profit sharing ratio agreed was 2:1:1.
Christopher brought Rs. 50,000 for his capital. His share of goodwill was agreed to at
Rs. 15,000. Christopher could bring only Rs. 10,000 out of his share of goodwill. Record
necessary journal entries in the books of the firm?
24 partners in a firm sharing profits and losses in the ratio of 4 : 5 : 6. On 31st March,
2014, Girdhari retired. On that date the capitals of Banwari, Girdhari and Murari before
the necessary adjustments stood at ₹ 2,00,000, ₹ 1,00,000 and ₹ 50,000, respectively.
On Girdhari’s retirement, goodwill of the firm was valued at ₹ 1,14,000. Revaluation of
assets and re-assessment of liabilities resulted in a profit of ₹ 6,000. General reserve
stood in the books of the firm at ₹ 30,000.
The amount payable to Girdhari was transferred to his loan account. Banwari and Murari
agreed to pay Girdhari two yearly instalments of ₹ 75,000 each including interest @
10% per annum on the outstanding balance during the first two years and the balance
including interest in the third year. The firm closes its books on 31st March every year.
Prepare Girdhari’s loan account till it is finally paid showing the working notes clearly.
(CBSE 2018)

25..A,B,C are partner share profit and loss equity they decided admit D as a new partner
pass journal entry in following condition:

1.Machinery is appreciated by 20% book value of machinery rupees 200000 .

2.Stock is depreciated by 10% book value of machinery ₹100000

3..Sale of unrecorded scrap of Rs. 5000.

26.. What journal entries will be recorded for the following transactions on the
dissolution of a firm:
[a] Payment of unrecorded liabilities of Rs.3,200.
[b] Stock worth Rs.7,500 is taken by a partner Rohit.
(C] An unrecorded asset realised Rs.5,500.

27.. Hari, Kunal and Uma are partners in a firm sharing profits and losses in the ratio of
5 : 3 : 2. From 1st April, 2018 they decided to share future profits and losses in the ratio
of 2 : 5 : 3. Their Balance Sheet showed a balance of Rs.75,000 in the Profit and Loss
Account and a balance of Rs 15,000 in Investment Fluctuation Fund. For this purpose, it
was agreed that:
(i) Goodwill of the firm was valued at ₹ 3,00,000.
(ii) Investments (having a book value of ₹ 50,000 were valued at ₹ 35,000.
(in) Stock having a book value of ₹ 50,000 be depreciated by 10%.
Pass the necessary journal entries for the above in the books of the firm.

28.. Ajay, Binay and Chetan were partners sharing profits in the ratio of 3 : 3 : 2. The
partnership deed provided for the following
(i) Salary of ₹ 2,000 per quarter to Ajay and Binay.
(ii) Chetan was entitled to a commission of ₹ 8,000.
(iii) Binay was guaranteed a profit of₹ 50,000 per annum.

The firm earned Profit during the year ended Rs 1,50,000 which were divided between
partners in the ratio of 2:2:1. , ignoring the above term pass an adjustment entry for the
error , your workings is part of your question.

29.. Sushil, Satish and Samir are partners sharing profits in the ratio of 5: 3: 2. Satish
retires on 1st April, 2022 from the firm. on which date capitals of Sushil, Satish and
Samir after all adjustments are ` 1,03,680, `87,840 and 26,880 respectively, The Cash
and Bank Balance on that date was ` 9,600. Satish is to be paid through amount
brought in by Sushil and Samir in such a way as to make their capitals proportionate
to their new profit-sharing ratio which will be Sushil 3/5 and Samir 2/5. Calculate the
amount to be paid or to be brought in , by the assuming that a minimum Cash and
Bank balance of 7,200 was to be maintained and pass the necessary Journal entries.

Or

A B & C are partner share profit and loss in the ratio of 2:2:1 B retired from the firm ,
their balance sheet information given as…..

Debtors :- 135000

(Minus ) prov.for.bad debt 15000

Additional Information: Debtors of ₹6000 will be written off as bad debt and a provision
of 5% on Debtors for bad and doubtful debt will be maintained . Pass journal entries for
related to Debtors and provision for doubtful debts.

30.. A and B share profits in the proportions of 3/4 and 1/4 . Their Balance Sheet on
Dec. 31, 2006 was as follows
On Jan. 1,2007, C was admitted into partnership on the following terms:
(a) That C pays Rs. 10,000 as his capital.
(b) That C pays Rs. 5,000 for goodwill. Half of this sum is to be withdrawn by A
and B.
(c) That stock and fixtures be reduced by 10% and a 5%, provision for doubtful debts be
created on Sundry Debtors and Bills Receivable.
(d) That the value of land and buildings be appreciated by 20%.
(e) There being a claim against the firm for damages, a liability to the extent of Rs. 1,000
should be created.
(f) An item of Rs. 650 included in sundry creditors is not likely to be claimed and hence
should be written back.

Record the above transactions (journal entries) in the books of the firm assuming that
the profit sharing ratio between A and B has not changed.

OR

.Azad and Babli are partners in a firm sharing profits and losses in the ratio of 2:1.
Chintan is admitted into the firm with 1/4 share in profits. Chintan will bring in Rs.
30,000 as his capital and the capitals of Azad and Babli are to be adjusted in the profit
sharing ratio. The Balance Sheet of Azad and Babli as on December 31, 2006 (before
Chintan’s admission) was as follows:

It was agreed that:

i) Chintan will bring in Rs. 12,000 as his share of goodwill premium.
ii) Buildings were valued at Rs. 45,000 and Machinery at Rs. 23,000.
iii) A provision for doubtful debts is to be created @ 6% on debtors.
iv) The capital accounts of Azad and Babli are to be adjusted by opening current
accounts.
Prepare Revaluation Account and partners capital account.

31.. Lalit, Madhur and Neena were partners sharing profits as 50%, 30% and 20%
respectively. On 31st March, 2013 their balance sheet was as follows

On this date, Madhur retired and Lalit and Neena agreed to continue on the following
terms
(i) The goodwill of the firm was valued at ₹ 56,000.
(ii) There was a claim for workmen’s compensation to the extent of ₹ 6,000.
(iii) Investments were brought down to ₹ 15,000.
(iv) Provision for bad debts was reduced by ₹ 1,000.
(v) Madhur was paid ₹ 10,300 in cash and the balance was transferred to his loan
account ..Lalit and Neena decide to adjust their capital in their new profit sharing ratio ,
by opening of current account..Their capital of new constituted firm will be Rs 45000..

Prepare necessary Revaluation Account and partner capital accounts.

32.. Rita, Geeta and Ashish were partners in a firm sharing profits/losses in the ratio of
3:2:1. On March 31, 2006 their balance sheet was as follows:
On the date of above mentioned date the firm was dissolved:
1. Rita was appointed to realise the assets. Rita was to receive 5% commission
on the rate of assets (except cash) and was to bear all expenses of realisation,
2. Assets were realised as follows:
Rs.
Debtors 30,000
Stock 26,000
Plant 42,750
3. Investments were realised at 85% of the book value,
4. Expenses of realisation amounted to Rs. 4,100,
5. Firm had to pay Rs. 7,200 for outstanding salary not provided for earlier,
6. Contingent liability in respect of bills discounted with the bank was also materialised
and paid off Rs. 9,800, Prepare Realisation account, Capital Accounts of Partner’s and
Cash Account.

33.. Puneet, Pankaj and Pammy are partners in a business sharing profits and
losses in the ratio of 2 : 2 : 1 respectively. Their balance sheet as on March 31,
2007 was as follows:

Mr. Pammy died on September 30, 2007. The partnership deed provided the
following:
(i) The deceased partner will be entitled to his share of profit up to the date of
death calculated on the basis of previous year’s profit.
(ii) He will be entitled to his share of goodwill of the firm calculated on the
basis of 3 years’ purchase of average of last 4 years’ profit. The profits for
the last four financial years are given below:
for 2003–04; Rs. 80,000; for 2004–05, Rs. 50,000; for 2005–06, Rs. 40,000;
for 2006–07, Rs. 30,000.
The drawings of the deceased partner up to the date of death amounted to
Rs. 10,000. Interest on capital is to be allowed at 12% per annum.
Surviving partners agreed that Rs. 15,400 should be paid to the executors
immediately and the balance in four equal yearly instalments with interest
at 12% p.a. on outstanding balance.
Show Mr. Pammy’s Capital account, his Executor’s account till the settlement
of the amount due and first installment only.

34.. X LTD. Co issued 50000 share of Rs 10 each at premium of Rs 2 per share due as
under …. On application Rs 3 per share ( including premium of Rs 1 )

On allotment Rs 4 per share ( including premium of Rs 1 )

On I st call Rs 3 per. And on 2 nd and finall call Rs 2 per share.

Application were received for all the share and all the share duly alloted to public. All
money on these alloted share were duly received except:-

Mr. X , a holder of 1000 share had only paid application money.

Mr. Y , a holder of 2000 share had paid only application and allotment money.

MR. Z , a holder of 3000 share had paid all their due with allotment.

Mr. W , a holder of 4000 share had paid all their due with First call..

Pass necessary journal entries in the book of X LTD company..

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