Doubts

Ritesh and Hitesh are childhood friends, Ritesh is a consultant whereas Hitesh is an architect. They contributed equal amounts and purchased a building for Rs. 2 crores. After a year, they sold it for Rs. 3 crores and shared the profits equally. Are they doing the business in partnership? Give reason in support of your answer. (Delhi and AI 2018)

SOLUTION No, they are not doing business in partnership because they are not involved in doing sale and purchase of land/plot on a regular basis. Mere co-ownership of a property…

Continue ReadingRitesh and Hitesh are childhood friends, Ritesh is a consultant whereas Hitesh is an architect. They contributed equal amounts and purchased a building for Rs. 2 crores. After a year, they sold it for Rs. 3 crores and shared the profits equally. Are they doing the business in partnership? Give reason in support of your answer. (Delhi and AI 2018)

Kajal, Neerav and Alisha are partners in a firm sharing profits in the ratio of 3: 2: 1. They decided to admit Rajan, their landlord as a partner in the firm. Rajan brought sufficient amount of capital and his share of goodwill premium. The accountant of the firm passed the entry of rent paid for the building to Rajan in ‘Profit and Loss Appropriation Account’. Is he correct in doing so? Give reason in support of your answer. (Al 2015 C)

SOLUTION No, accountant of the firm is not correct in doing so.Reason: Because rent paid is a charge against the profit so it should be debited to Profit & Loss…

Continue ReadingKajal, Neerav and Alisha are partners in a firm sharing profits in the ratio of 3: 2: 1. They decided to admit Rajan, their landlord as a partner in the firm. Rajan brought sufficient amount of capital and his share of goodwill premium. The accountant of the firm passed the entry of rent paid for the building to Rajan in ‘Profit and Loss Appropriation Account’. Is he correct in doing so? Give reason in support of your answer. (Al 2015 C)

Gupta and Sharma were partners in a firm. They wanted to admit two more members in the firm. List the categories of individuals other than minors who cannot be admitted by them. (Delhi 2017)

SOLUTION Apart from minor, the following individuals cannot be admitted as partners:(i) Persons of unsound mind (e.g., lunatics or insane), and(ii) Persons disqualified by law (e.g., alien enemies, insolvents).

Continue ReadingGupta and Sharma were partners in a firm. They wanted to admit two more members in the firm. List the categories of individuals other than minors who cannot be admitted by them. (Delhi 2017)

A group of 40 people wants to form a partnership firm. They want your advice regarding the maximum number of persons that can be there in a partnership firm and the Name of the Act under whose provisions, it is given. (AI 2016)

SOLUTION The maximum number of partners in a firm can be 50 as per Section 464 of the Companies Act, 2013 read along with Rule 10 of the Companies (Miscellaneous)…

Continue ReadingA group of 40 people wants to form a partnership firm. They want your advice regarding the maximum number of persons that can be there in a partnership firm and the Name of the Act under whose provisions, it is given. (AI 2016)

What is the maximum number of partners that a partnership firm can have? Name the Act that provides for the maximum number of partners in a partnership firm.  (Delhi 2016)

SOLUTION The maximum number of partners in a firm can be 50 as per Section 464 of the Companies Act, 2013 read along with Rule 10 of the Companies (Miscellaneous)…

Continue ReadingWhat is the maximum number of partners that a partnership firm can have? Name the Act that provides for the maximum number of partners in a partnership firm.  (Delhi 2016)