Profit Distribution

Correct answer: A. Rs 200000

Cs normal share was Rs 100000 because deficiency of Rs 10000 was added separately. If five tenth share is Rs 100000 then total profit is Rs 200000.

Correct answer: A. Rs 40,000

Profit is shared in the ratio of claims. With ratio 4:1 the total parts = 5, so A’s share = 4/5. Therefore A = (4/5) × Rs 50,000 = Rs 40,000. Alternate check: A’s claim of total Rs 75,000 = (4/5)×75,000 = Rs 60,000, so A’s share = (60,000/75,000)×50,000 = Rs 40,000. Why distractors are wrong: Rs 30,000 or Rs 10,000 correspond to incorrect fractions (e.g. 3/5 or 1/5), and Rs 50,000 would mean giving entire profit to A. Exam tip: convert the ratio into fractional share (part/total parts) before multiplying by available profit.

Correct answer: A. Rs 60000

The direct answer is A: Rs 60,000. The total profit is Rs 160,000. A receives one-fourth of the total profit in place of salary, so A’s amount is Rs 160,000 × 1/4 = Rs 40,000. The balance is Rs 160,000 − Rs 40,000 = Rs 120,000. This balance is shared equally by B and C, so each receives Rs 120,000 ÷ 2 = Rs 60,000. Option A is correct because B receives one-half of the remaining profit. Option B, Rs 40,000, is A’s one-fourth amount, not B’s share. Option C, Rs 80,000, would be too high and would not leave an equal balance for C. Option D, Rs 30,000, is not half of Rs 120,000. The useful method is: first remove the amount given to A, then divide the remainder equally between B and C.

Correct answer: A. Rs 30000

Cs normal share is Rs 40000 so deficiency is Rs 10000. Deducting it from As normal Rs 40000 leaves Rs 30000.

Correct answer: A. There will be no deficiency

Core concept: Guarantee adjustment is required only when the partner’s normal share is less than the guaranteed amount. Here A’s normal share (Rs 55,000) exceeds the guarantee (Rs 50,000), so there is no deficiency and no additional payment by the firm. Option B would be relevant only if normal share were smaller (deficiency = guarantee − normal share). Option D is incorrect because a guarantee is not automatically a loss — it only leads to payment if the normal share falls short. Exam tip: compare normal share and guarantee first; compute deficiency only when guarantee > normal share (deficiency = guarantee − normal share).

Correct answer: A. Rs 60000

Deduct the salary first: distributable profit = 210000 − 30000 = 180000. The ratio sum is 3+2+1 = 6, so B's share = (2/6) × 180000 = Rs 60000. Option B (Rs 70000) reflects the mistake of not deducting the salary: (2/6) × 210000 = 70000. Exam tip: always subtract pre-distribution items (salary, interest on capital etc.) before dividing profit by the partners' ratio.

Correct answer: A. Rs 102000

As share in remaining profit is two third which is Rs 60000. Adding salary and commission gives total claim Rs 102000.

Correct answer: A. Rs 16,000

By sequential appropriation, A's salary is deducted first: remaining profit = Rs 180,000 − Rs 20,000 = Rs 160,000. B's commission = 10% of Rs 160,000 = Rs 16,000, so option A is correct. Why other choices are wrong: B (Rs 18,000) would be 10% of the total profit (incorrect procedure), C (Rs 20,000) is A's salary not B's commission, D (Rs 14,000) does not follow any correct percentage of the remaining profit. Exam tip: always apply prescribed appropriations in the correct order — deduct salaries/interest first, then compute commissions on the resulting balance.

Correct answer: A. About Rs 14545

Profit after salary is Rs 160000 and commission is after charging commission. Commission is (160000 \times \frac{10}{110}) which is about Rs 14545.

Correct answer: A. About Rs 31667

The total profit is Rs 240,000. The agreed salary to A and commission to B are appropriations made before the remaining profit is divided. First subtract Rs 30,000 salary and Rs 20,000 commission: Rs 240,000 − Rs 30,000 − Rs 20,000 = Rs 190,000. This remaining amount is shared among A, B, and C in the ratio 2:3:1. The total of the ratio parts is 6, so C’s share is one part out of six.

C’s amount is therefore Rs 190,000 × 1/6 = Rs 31,666.67, which is approximately Rs 31,667. Hence option A is correct. The salary and commission are not included again in C’s ratio share, because they have already been deducted before the residual profit is distributed. The other options do not equal one-sixth of the remaining Rs 190,000.

Correct answer: A. Rs 18000

A received Rs 36000 wrongly. Correct share is Rs 18000 so A must return Rs 18000 through adjustment.

Correct answer: A. Interest on drawings will still be charged

Interest on drawings is a charge from partner and does not depend on profit. If deed provides it then it is charged.

Correct answer: A. It may be treated as expense as per deed

The governing concept is the priority given by an express partnership-deed clause. Interest on capital is ordinarily treated as an appropriation of profit, and under the usual rule it is allowed only when profit is available. However, the question specifically states that the deed authorises it as an expense before determining profit. Such an explicit agreement governs the partners’ accounting treatment, so the amount may be charged before profit even in a loss year, subject to the clause’s exact wording and applicable law. Thus option A is correct. It is not drawings, because it is not a withdrawal, and it does not become a reserve.

Correct answer: A. About Rs 6667

After salary remaining profit is Rs 70000 and Cs normal share is about Rs 23333. Deficiency from guarantee is about Rs 6667.

Correct answer: A. Profit distributable to A and B will reduce

Under firm guarantee deficiency is adjusted from total distribution. This reduces final shares of other partners.

Correct answer: A. Rs 18000

Total claim is Rs 50000 and Bs share is two fifths. Two fifths of available profit is Rs 18000.

Correct answer: A. About Rs 58,333

Compute remaining profit by adding credit incomes and subtracting debit appropriations: Remaining profit = Rs 200000 + Rs 12000 − Rs 72000 = Rs 140000. Total ratio 3+4+5 = 12; third partner’s share = 5/12 × Rs 140000 = Rs 58,333.33 ≈ Rs 58,333. Option B (Rs 70,000) is incorrect because it assumes half the profit; option D (Rs 60,000) is just a rounded/miscalculated value. Exam tip: Always include items on the credit side (incomes) and deduct all debit appropriations before dividing by the profit-sharing ratio.

Correct answer: A. Some appropriation item or second effect is missing

Appropriation account should balance after distributing final profit or loss. If difference exists find omitted or reversed item.

Correct answer: A. Difference between correct new ratio and wrong old ratio

In correction correct share and wrong share are calculated. The difference is debited or credited to partners.

Correct answer: A. Credit Rs 12000

Core concept: In re-distribution/adjustment, a partner who has received less than what the new ratio entitles them to must be credited with the shortfall. Here A should have got Rs 60,000 but got Rs 48,000 — a shortfall of Rs 12,000. Therefore A's account is credited by Rs 12,000 (other partners are debited according to their gaining shares). Why the nearest distractor is wrong: option B (Debit Rs 12,000) is incorrect because a debit would mean A received excess. Option C (No effect) is wrong because there is a difference to adjust. Option D (Debit Rs 48,000) is not appropriate in adjustment entries. Exam tip: compute difference = new amount − old amount; if positive, credit the partner; if negative, debit the partner.

Correct answer: A. Full use of available profit and matching all partners shares

All appropriations and final shares must match total profit. After guarantee no guaranteed partner should receive less than minimum.

Correct answer: A. Rs 185000

Interest on drawings is added to net profit and other appropriations are deducted. Rs 300000 plus Rs 15000 minus Rs 130000 equals Rs 185000.

Correct answer: A. Rs 24,000

The governing concept is commission calculated on profit after charging that commission, with salary deducted before determining the commission base. Profit before salary is Rs 260,000, and A’s salary is Rs 36,000, so profit before commission is Rs 260,000 − Rs 36,000 = Rs 224,000. Since commission is 12% after charging commission, the commission-inclusive base represents 112%; therefore commission = Rs 224,000 × 12/112 = Rs 24,000. Verification: after deducting Rs 24,000, the remaining profit is Rs 200,000, and 12% of Rs 200,000 is Rs 24,000. Thus option A is correct. Option C applies 12% to the original profit, option D uses an incorrect denominator, and option B does not satisfy the after-charging condition.

Correct answer: A. Rs 70000

Cs normal share is Rs 30000 so deficiency is Rs 20000. Bs normal share was Rs 90000 and after deduction it becomes Rs 70000.

Correct answer: A. Rs 10000

'Remaining profit ratio' between A and B means consider only A and B: 5 : 3. Total parts = 5 + 3 = 8. A's share = \(\frac{5}{8}\times 16000 = 10000\) rupees, so A bears Rs 10,000. Closest distractor Rs 8,000 is actually B's share (\(\frac{3}{8}\times 16000\)); Rs 6,000 reflects a calculation error and Rs 16,000 would mean A alone bore the entire deficiency. Exam tip: allocate deficiency only among the partners who are specified to bear it, using their mutual ratio (exclude others).