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12th | Accounting For Partnership Firms Fundamentals | Question No. 1 to 5 | Ts Grewal Solution 2022-2023

Double Entry Book Keeping Ts Grewal Vol. 1 2019 Solutions for Class 12 Commerce ACCOUNTANCY Chapter 2 - Accounting For Partnership Firms Fundamentals

Double Entry Book Keeping Ts Grewal Volume-I 2022-2023

Solutions for Class 12 Commerce Accountancy

Chapter 2 - Accounting For Partnership Firms Fundamentals

 

Page No 2.81:

Question 1:


In the absence of Partnership Deed, what are the rules relation to :
(a) Salaries of partners,
(b) Interest on partners’ capitals,
(c) Interest on loan by partner,
(d) Division of profit,
(e) Interest on partners’ drawings

(f) Interest on loan to partners?

Answer:


 

 Items (Points)

 Provision in the Absence of Partnership Deed

(a)

 Salaries of Partners

 No Salary will be allowed to Partners.

(b)

 Interest on Partners’ Capitals

 No interest will be allowed to Partners on Capital

(c)

 Interest on Loan by Partners’

 6% p.a. Interest will be allowed on the amount given by
 partners in the form of Loans and Advances to firm.

(d)

 Division of Profit

 Profits will be shared equally, it is irrespective the
 amount of capital contributed by partners

(e)

 Interest on Partners’ Drawings

 No Interest will be charged on the Drawings of Partners

(F)

Interest on loan to partner

Not charged from partner



 

Page No 2.81:

Question 2:

Mahesh, Ramesh and Suresh are partners in a firm. They do not have a Partnership Deed. At the end of the first year of the commencement of the firm, they have faced the following problems :
(a) Mahesh wants that interest on capital should be allowed to the partners but Ramesh and Suresh do not agree.
(b) Ramesh wants that the partners should be allowed to draw salary but Mahesh and Suresh do not agree.
(c) Suresh wants that the loan given by him to the firm should bear interest @ 10% p.a. but Mahesh and Ramesh do not agree.
(d) Mahesh and Ramesh having contributed larger amounts of capital, desire that the profits should be divided in the ratio of their capital contribution but Suresh does not agree.
State how you will settle these disputes if the partners approach you for purpose.

Answer:


 

Disputes

Possible Judgements

(a)

Mahesh wants that interest on capital should be allowed to the partners but Ramesh and Suresh do not agree. 

As per Partnership Act, no interest on Capital will be allowed.

Reason: There is no partnership agreement among Mahesh, Ramesh and Suresh regarding interest on capital.

(b)

Ramesh wants that the partners should be allowed to draw salary but Mahesh and Suresh do not agree.

No salary will be allowed to any partner.

Reason: There is no partnership agreement.

(c)

Suresh wants that the loan given by him to the firm should bear interest @ 10% p.a. but Mahesh and Ramesh do not agree.

Interest on partner’s loan (Suresh’s loan) will be allowed at 6% p.a.

Reason: As per Partnership Act, in the absence of partnership agreement, interest on partners loan is allowed at 6% p.a.

(d)

Mahesh and Ramesh having contributed larger amounts of capital, desire that the profits should be divided in the ratio of their capital contribution but Suresh does not agree.

Profit will be shared equally and not in the capital ratio.

Reason: There is no partnership agreement.


 

Page No 2.81:

Question 3:


Following differences have arisen among P, Q and R. State who is correct in each case:
(a) P used
 ` 20,000 belonging to the firm and made a profit of  ` 5,000. Q and R want the amount to be given to the firm?
(b) Q used  `5,000 belonging to the firm and suffered a loss of 
` 1000. He wants the firm to bear the loss?
(c) P and Q want to purchase goods from A Ltd., R does not agree?
(d) Q and R want to admit C as partner, P does not agree?

(e) R had given loan of `1,00,000 to firm and demands interest @ 10% p.a. P  and Q do not want to pay the interest.

 

Answer:


(a) P is bound to pay ` 20,000 together with profit of ` 5,000 to the firm because this amount belongs to the firm.

Explanation: As per Principal and Agent relationship, P is principal as well as agent to the firm and to Q and R. As per this rule, any profit earned by an agent (P) by using the firm’s property is attributable to the firm.

 

(b) Q is liable to pay ` 5,000 to the firm. As per the Partnership Act, 1932, every partner of a partnership firm is liable to the firm for any loss caused by his/her willful negligence.

Explanation: Here Q is solely responsible for the loss of ` 1,000 because he used the property of the firm and also represented himself as a principal rather than an agent to the other partners and to the firm.

(c) P and Q may buy goods from A Ltd.

 

Explanation: As per Partnership Act, 1932, a partner has a right to buy and sell goods without consulting the other partners unless a Public Notice has been given by the partnership firm to restrict the partners to buy and sell.

 

(d) C will not be admitted because one of the partners P has not agreed to admit C.

 

(e) P,Q and R are not correct

 

Explanation: As per Partnership Act, a new partner cannot be admitted into a firm unless all the existing partners agree on the same decision. In other words, a new partner can be admitted in a partnership firm with the consent of all the existing partners.

 

Page No 2.81:

Question 4: Bose, Sarkar and Chatterjee are partners in a firm and do not have a Partnership Deed. Bose introduced


further capital of `5,00,000 on 1st October, 2021. Whereas Chatterjee took a loan of ` 50,000 from the firm

on 1st October, 2021. Disputes have arisen among them on the following issues:

(a) Bose demands interest 10% p.a. on ` 5,00,000 being his extra capital.

(b) Sarkar desires that his son Deep should be admitted as partner and he will give him half of his share

Bose and Chatterjee do not agree.

(c) Bose and Sarkar are of the view that Chatterjee should be charged interest on loan from the firm at

the lending rate of the banks, which is 12% p.a.

(d) Sarkar has withdrawn `50,000 from the firm for his personal use. Bose and Chatterjee are of the view

that Sarkar should be charged interest @ 10% p.a.

You are required to give solution to each issue of dispute.

 

Answer:


In the absence of Partnership Deed, the provisions of Indian Partnership Act, 1932 will apply as follows;

(a) Interest will not be allowed on extra capital introduced by Bose,

(b) Deep cannot be admitted as Bose and Chatterjee don't agree, no partner has right to admit any one as a partner,

(c) Interest will not be charged from Chatterjee as rate of interest was not agreed.

(d) Interest on drawings will not be charged on Sarkar’s drawings.

 

Page No 2.82:

Question 5:


A and B are partners from 1st April, 2021, without a Partnership Deed and they introduced capitals of   `35,000 and  `20,000 respectively. On 1st October, 2021, A advanced loan of  `8,000 to the firm without any agreement as to interest. The profit and Loss Account for the year ended 31st March, 2022 shows a profit of  ` 15,000 but the partners cannot agree on payment of interest and on the basis of division of profits.
You are required to divide the profits between them giving reasons for your method.

Answer:


Profit and Loss Account

for the year ended March 31, 2022

Dr.

 

 

Cr.

Particulars

 ( `)

Particulars

 ( `)

Interest on A’s Loan

240

Profit (before Interest)    

15,000

Profit transferred to:

14,760

 

 

(Net Profit transferred to P&L Appropriation a/c)

 

 

 

 

 

 

 

 

 

 

15,000

 

15,000

 

 

 

 

 

 

Profit and Loss Account

for the year ended March 31, 2022

Dr.

 

 

Cr.

Particulars

 ( `)

Particulars

 ( `)

 

Profit

(Net Profit transferred from P&L  a/c)

14,760

Profit transferred to:

 

 

 

A’s Capital A/c

7,380

 

 

 

B’s Capital A/c

7,380

14,760

 

 

 

15,000

 

15,000

 

 

 

 

 

Working Notes:

 

WN 1 Calculation of Interest on Loan

As per the Partnership Act, if there is no partnership agreement regarding rate of interest on loan, it is provided at 6% p.a.

Amount of Loan = ` 8,000

Time Period (from October 01 to March 31) = 6 months

Interest on A' s loan=8,000×6/100×6/12=240

 

WN 2 Calculation of Profit Share of each Partner

In the absence of partnership deed, profits of a firm are distributed equally among all the partners.

Profit after Interest on A’s loan = 15,000- ` 240 = ` 14,760

Profit of  A and B=14,760×1/2=7380

 

Ts Grewal Solution 2022-2023

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Class 12 / Volume – I

Chapter 1 – Accounting For Partnership Firms Fundamentals

 

Question No. 1 To 5
Question No. 5 To 10
Question No. 11 To 15
Question No. 16 To 20
Question No. 21 To 25
Question No. 26 To 30
Question No. 31 To 35
Question No. 36 To 40
Question No. 41 To 45
Question No. 46 To 50
Question No. 51 To 55

Question No. 56 To 60

Question No. 61 To 65
Question No. 66 To 70
Question No. 71 To 75

Question No. 76 To 80
Question No. 81 To 85
Question No. 86 To 88

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