D.A.

V PUBLIC SCHOOL,POKHARIPUT
PRACTICE TEST
ACCOUNTANCY
CLASS: XII
1. Which of the following is true regarding Commission to a partner when the firm maintains
fixed capital accounts?
a) Debit Partner’s Loan A/c and Credit P & L Appropriation A/c.
b) Debit P & L A/c and Credit Partner’s Capital A/c.
c) Debit P & L Appropriation A/c and Credit Partner’s Current A/c.
d) Debit P & L Appropriation A/c and Credit Partner’s Capital A/c
2. In the absence of partnership deed, a partner is entitled to an interest on the amount
advanced by him to the firm at a rate of:
a) entitled for 6% p.a. on their additional capital, only when there are profits.
b) entitled for 10% p.a. on their additional capital
c) entitled for 6% p.a. on their Amount of advance.
d) not entitled for any interest on their additional capitals.
3. Sarvesh, Sriniketan and Srinivas are partners in the ratio of 5:3: 2. If Sriniketan’s share of
profit at the end of the year amounted to ₹1,50,000, what will be Sarvesh’s share of profits?
a) ₹5,00,000.
b) ₹1,50,000.
c) ₹3,00,000.
d) ₹2,50,000.

4. B and C are partners, their partnership deed provides for interest on drawings at 8% per
annum. B withdrew a fixed amount in the middle of every month and his interest on drawings
amounted to ₹4,800 at the end of the year. What was the amount of his yearly drawings?
a) ₹10,000.
b) ₹5,000.
c) ₹1,20,000.
d) ₹48,000.

5. In the absence of an agreement, partners are entitled to ------

a) Salary
b) Profit share in capital ratio
c) Interest an loan and advances @ 6% p.a.
d) Commission

6. Mickey, Tom and Jerry were partners in the ratio of 5:3:2. On 31st March 2021, their
books reflected a net profit of ₹90,000. As per the terms of the partnership deed they were
entitled for interest on capital which amounted to ₹80,000, ₹60,000 and ₹40,000
respectively. Calculate the ratio in which the profits would be appropriated.
 a) 13:11:4
b) 5:3:2
c) 7:6:2
d) 4:3:2

7.Rent paid to a partner is debited to

a) Partner’s capital A/c
b) Profit and loss A/c
c) Profit and loss Appropriation A/c
d) Partner’s current A/c

8.Current Account of the partners should be opened, when capital are:

a) Fluctuating
b) Fixed
c) Circulating
d) None of these

9.The balance of partner’s capital Accounts in case of fixed capital method,are:

a) Always debit
b) Always credit
c) Either debit/credit
d) Neither debit nor credit.

10.The relation of a partner with the firm is that of:

a) A principal
b) An Agent
c) Both a principal and agent
d) A manager

11.If provided in deed,interest on capital is provided to partners only out of:

a) Accumulated profit
b) Reserves
c) Profit of current year
d) Goodwill.

12.A and B are partners in a firm.the net divisible profit as per profit and loss appropriation
A/c is Rs 2,50,000. the total interest on partners drawing Rs 4,000 A is entitled to a salary of
4000 per quarter and B Rs 40,000 per annum. The net profit/loss earned during the year as:
a) Rs 2,90,000
b) Rs 3,02,000
c) Rs 2,10,000
d) Rs 3,08,000

13. Given below are two statements, one labelled as

Assertion (A) and the other labelled as Reason (R)
Assertion (A): Transfer to reserves is shown in P & L Appropriation A/c.
Reason (R): Reserves are appropriation of the profits.
In the context of the above statements, which one of the following is correct? Codes:
.
a) Both Assertion(A) and Reason(R) are true and reason (R ) is the correct explanation
of assertion(A)
b) Both Assertion(A) and Reason(R) are true and reason (R ) is not the correct
explanation of assertion(A)
c) Assertion (A) is true but Reason (R) is false
d) Assertion (A) is false but Reason (R) is true

14. Given below are two statements, one labelled as

Assertion (A) and the other labelled as Reason (R)
Assertion (A) Partner can bind other partners by his acts and also is bound by the acts of
other partners with regard to business of the firm.
Reason (R) Each partner carrying on the business is the principal as well as the agent for all
the other partners.
a) Both Assertion(A) and Reason(R) are true and reason (R ) is the correct explanation
of assertion(A)
b) Both Assertion(A) and Reason(R) are true and reason (R ) is not the correct
explanation of assertion(A)
c) Assertion (A) is true but Reason (R) is false
d) Assertion (A) is false but Reason (R) is true

15. In the absence or of any Partnership Agreement, the profits or losses of the firm are
divided
a) In Capital Ratio
b) (B). In Equal Ratio
c) In any of these two ratios
d) None of these

16. Given below are two statements, one labelled as

Assertion (A) and the other labelled as Reason (R)
Assertion (A): Under the fluctuating capital method, the capital account fluctuate from time
to time.
Reason(R) All the adjustments such as share of profit and loss, interest on capital, drawings,
interest on drawings, salary or commission to partners, etc are recorded directly in the capital
accounts of the partners.
 a) Both Assertion(A) and Reason(R) are true and reason (R ) is the correct explanation
of assertion(A)
b) Both Assertion(A) and Reason(R) are true and reason (R ) is not the correct
explanation of assertion(A)
c) Assertion (A) is true but Reason (R) is false
d) Assertion (A) is false but Reason (R) is true

17. Given below are two statements, one labelled as

Assertion (A) and the other labelled as Reason (R)
Assertion (A): The capital account of partner, in case of fixed capital method, always show a
credit balance in spite of consistent losses.
Reason (R )All losses are debited to current account of the partners,so capital account do not
show debit balance.
a) Both Assertion(A) and Reason(R) are true and reason (R ) is the correct explanation
of assertion(A)
b) Both Assertion(A) and Reason(R) are true and reason (R ) is not the correct
explanation of assertion(A)
c) Assertion (A) is true but Reason (R) is false Assertion (A) is false but Reason (R) is
true

Read the following hypothetical text and answer the given questions:
Amitabh and Babul are partners in a trading business 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.
Babul is to be allowed an annual salary of Rs. 2,500. Manager is to be allowed commission
Rs. 5,000. Amitabh has also given a Loan on April 01 , 2019 of Rs. 50,000 to the firm
without any agreement. During the year 2019-20, the profits earned is Rs. 22,250. the year
ending March 31, 2020
18.What is the amount of net profit.
a) Rs 22250
b) Rs 24750
c) Rs 14250
d) Rs15,000

19.find out the interest on Amitabh’s loan.

a) Rs 3000
b) Rs1500
c) Rs1000
d) Rs 1200

20.What is the amount of profit Babul’s will get.

a) Rs 2,000
b) Rs 2,780
 c) Rs1,200
d) Rs 2,800

21. Reena and Raman are partners with capitals of Rs. 3,00,000 and Rs. 1,00,000
respectively. The profit for the year ended March 31, 2020 was Rs. 1,80,000, before paying
rent for her personal building to be used as godown for firm to Reena payable at Rs. 5000 per
month. Interest on capital is to be allowed at 6% p.a. Raman was entitled to a salary of Rs.
30,000 p.a. The drawings of partners were Rs. 30,000 and 20,000. The interest on drawings to
be charged to Reena was Rs. 1,000 and to Raman, Rs. 500. Assuming that Reena and Raman
are equal partners. State their share of profit after necessary appropriations.(3)
22. Saloni and Srishti are partners in a firm. Their capital accounts as on April 01. 2019
showed a balance of Rs. 2,00,000 and Rs. 3,00,000 respectively. On July 01, 2019, Saloni
introduced additional capital of Rs. 50,000 and Srishti, Rs. 60,000. On October 01 Saloni
withdrew Rs. 30,000, and on January 01, 2020 Srishti withdraw, Rs. 15,000 from their
capitals. Interest is allowed @ 8% p.a. Calculate interest payable on capital to both the
partners during the financial year 2019–2020.(4)
23. Josh and Krish are partners sharing profits and losses in the ratio of 3:1. Their capitals at
the end of the financial year 2015-2016 were Rs. 1,50,000 and Rs. 75,000. During the year
2015-2016, Josh’s drawings were Rs. 20,000 and the drawings of Krish were Rs. 5,000,
which had been duly debited to partner’s capital accounts. Profit before charging interest on
capital for the year was Rs. 16,000. The same had also been debited in their profit sharing
ratio. Krish had brought additional capital of Rs. 16,000 on October 1, 2015. Calculate
interest on capital @ 12% p.a. for the year 2015-2016. .(6)
24. Anupam and Abhishek are partners sharing profits and losses in the ratio of 3 : 2. Their
capital accounts showed balances of Rs. 1,50,000 and Rs. 2,00,000 respectively on April 01,
2019. Show the calculation of interest on capital for the year ending December 31, 2020 in
each of the following alternatives
(4)
(a) If the partnership deed is silent as to the payment of interest on capital and the profit for
the year is Rs. 50,000;
(b) If partnership deed provides for interest on capital @ 8% p.a. and the firm incurred a loss
of Rs. 10,000 during the year;
(c) If partnership deed provides for interest on capital @ 8% p.a. and the firm earned a profit
of Rs. 50,000 during the year;
(d) If the partnership deed provides for interest on capital @ 8% p.a. and the firm earned a
profit of Rs. 14,000 during the year.
25. Ram and Syam are partners sharing profits/losses equally. Ram withdrew Rs. 1,000 p.m.
regularly on the first day of every month during the year 2015-16 for personal expenses. If
interest on drawings is charged @ 5% p.a. Calculate interest on the drawings of Ram.
(3)
26. Verma and Kaul are partners in a firm. The partnership agreement provides that interest
on drawings should be charged @ 6% p.a. Verma withdraws Rs. 2,000 per month starting
from April 01, 2019 to March 31, 2020. Kaul withdrew Rs, 3,000 per quarter, starting from
April 01, 2019. Calculate interest on partner’s drawings
(3).
27. Kavita and Lalit are partners sharing profits in the ratio of 2:1. They decide to admit
Mohan with share in profits with a guaranteed amount of Rs. 25,000. Both Kavita and Lalita
undertake to meet the liability arising out of Guaranteed amount to Mohan in their respective
profit sharing ratio. The profit sharing ratio between Kavita and Lalit does not change. The
firm earned profits of Rs. 76,000 for the year 2006–07.Show the distribution of profit
amongst the partners (3)
28. Nusrat, Sonu and Himesh are partners sharing profits and losses in the ratio of 5 : 3 : 2.
The partnership deed provides for charging interest on drawing’s @ 10% p.a. The drawings
of Nusrat, Sonu and Himesh during the year ending March 31, 2015 amounted to Rs. 20,000,
Rs. 15,000 and Rs. 10,000 respectively. After the final accounts have been prepared, it was
discovered that interest on drawings has not been taken into consideration. Give necessary
adjusting journal entry.(3)
29. Krishna, Sandeep and Karim are partners sharing profits in the ratio of 3:2:1. Their fixed
capitals are: Krishan Rs. 1,20,000, Sandeep 90,000 and Karim 60,000. For the year 2014-15,
interest was credited to them @ 6% p.a. instead of 5% p.a. Record adjustment entries
(4)
30. On March 31, 2017 the balance in the capital accounts of Eluin, Monu and Ahmed, after
making adjustments for profits, drawing, etc; were Rs. 80,000, Rs. 60,000 and Rs. 40,000
respectively. Subsequently, it was discovered that interest on capital and interest on drawings
had been omitted. The partners were entitled to interest on capital @ 5% p.a. The drawings
during the year were Eluin Rs. 20,000; Monu, Rs. 15,000 and Ahmed, Rs. 9,000. Interest on
drawings chargeable to partners were Eluin Rs, 500, Monu Rs. 360 and Ahmed Rs. 200. The
net profit during the year amounted to Rs. 1,20,000. The profit sharing ratio was 3 : 2 : 1.
Record necessary adjustment entry.(6)
31. (i)The books of a business showed that the firm’s capital employed on December 31,
2015, Rs. 5,00,000 and the profits for the last five years were: 2010–Rs. 40,000: 2012-Rs.
50,000; 2013-Rs. 55,000; 2014- Rs.70,000 and 2015-Rs. 85,000. You are required to find out
the value of goodwill based on 3 years purchase of the super profits of the business, given
that the normal rate of return is 10%.
(ii) A business has earned average profits of Rs. 1,00,000 during the last few years and the
normal rate of return in a similar business is 10%. Ascertain the value of goodwill by
capitalisation average profits method, given that the value of net assets of the business is Rs.
8,20,000.(6)
32. A, B & C are partners sharing profits in the ration of 1:2:3 on 1st April 2019 they decided
to share profits equally. On the date there was credit balance of `Rs1, 20,00; in their P & L
A/c & a balance of `Rs1, 80,000 in General Reserve Ac. It is decided to record an adjustment
entry, instead of closing the General Reserve & P & L A/c, Do the journal entries.(3)
33. A, B & C are partners sharing profit & losses in the ratio of 5:4:1. It was decided that
w.e.f. 1st April 2019 . The profit sharing ratio will be 9:6:5. Goodwill is to be valued at 2
years purchase of average profits of last 3 years profits. The profit for 2016-17, 2017-18 &
2018-19 were -Rs 42,000, `-` Rs48,000 &-Rs 60,000 respectively. Goodwill appears in the
books at Rs 10,000. (i)Pass necessary journal entry for the treatment of goodwill. (6)
(ii)Also give journal entries if goodwill is raised & writeen off.
34.X, Y, Z are partners sharing profits & losses in the ratio of 5:3:2. They decide to share
future profits & losses in the ratio of 2:3:5 w.e.f 1st April 2019 Following items appear in the
balance sheet as on 31/3/18
General ReserveRs75,000 Workmen Compensation Reserve Rs12,500 Profit & Loss Account
Rs 37,500 Advertisement Suspense A/c (Dr), Rs 50,000 (6)
i) Pass necessary journal entries
ii). Show the effect without affecting their book values by passing an adjustment entry