Doubts

Nirmal and Pawan are partners sharing profits in the ratio of 3: 2. The firm had given loan to Pawan of Rs. 5,00,000 on 1st April, 2021. Interest was to be charged @ 10% p.a. The firm took loan of Rs. 2,00,000 from Nirmal on 1st October, 2021. Before giving effect to the above, the firm incurred a loss of Rs. 10,000 for the year ended 31st March, 2022. Determine the amount to be transferred to Profit and Loss Appropriation Account.

SOLUTION

Continue ReadingNirmal and Pawan are partners sharing profits in the ratio of 3: 2. The firm had given loan to Pawan of Rs. 5,00,000 on 1st April, 2021. Interest was to be charged @ 10% p.a. The firm took loan of Rs. 2,00,000 from Nirmal on 1st October, 2021. Before giving effect to the above, the firm incurred a loss of Rs. 10,000 for the year ended 31st March, 2022. Determine the amount to be transferred to Profit and Loss Appropriation Account.

Akhil and Bimal are partners sharing profits in the ratio of 3: 2. Akhil gave loan to the firm of Rs. 1,00,000 on 1st October, 2021. On the same date, the firm gave loan to Bimal of Rs. 1,00 000. They do not have an agreement as to interest. Akhil had also given his personal property for firm’s godown at a monthly rent of Rs. 5,000. Firm earns profit of Rs. 1,03,000 (before above adjustments) for the year ended 31st March, 2022. Show the distribution of profit for the year.

SOLUTION

Continue ReadingAkhil and Bimal are partners sharing profits in the ratio of 3: 2. Akhil gave loan to the firm of Rs. 1,00,000 on 1st October, 2021. On the same date, the firm gave loan to Bimal of Rs. 1,00 000. They do not have an agreement as to interest. Akhil had also given his personal property for firm’s godown at a monthly rent of Rs. 5,000. Firm earns profit of Rs. 1,03,000 (before above adjustments) for the year ended 31st March, 2022. Show the distribution of profit for the year.

Sita and Geeta are partners in a firm sharing profits in the ratio of 3: 2. They had advanced to the firm a sum of Rs. 30,000 as a loan in their profit-sharing ratio on 1st October, 2021. The Partnership Deed is silent on interest on loans from partners. Compute interest payable by the firm to the partners, assuming the firm closes its books every year on 31st March.

SOLUTION Amount advanced by the Partners = Rs.  30,000Profit sharing ratio = 3: 2Advanced by Sita = 30,000 × 3 / 5 = 18,000Advanced by Geeta = 30,000 × 2 / 5 = 12,000 Time Period (from…

Continue ReadingSita and Geeta are partners in a firm sharing profits in the ratio of 3: 2. They had advanced to the firm a sum of Rs. 30,000 as a loan in their profit-sharing ratio on 1st October, 2021. The Partnership Deed is silent on interest on loans from partners. Compute interest payable by the firm to the partners, assuming the firm closes its books every year on 31st March.

Bose, Sarkar and Chatterjee are partners in a firm and do not have a partnership deed. Bose introduced further capital of Rs. 5,00,000 on 1st October, 2021. Whereas Chatterjee took a loan of Rs. 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 Rs. 5,00,000 being his extra capital. (b) Sarkar desires that his son Deep should be admitted as partner and he will give his 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 Rs. 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.

SOLUTION 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,…

Continue ReadingBose, Sarkar and Chatterjee are partners in a firm and do not have a partnership deed. Bose introduced further capital of Rs. 5,00,000 on 1st October, 2021. Whereas Chatterjee took a loan of Rs. 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 Rs. 5,00,000 being his extra capital. (b) Sarkar desires that his son Deep should be admitted as partner and he will give his 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 Rs. 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.

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 business. they 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) Mahesh and Ramesh want that Suresh should pay interest on loan given to him by the firm but Suresh does not agree. (d) Mahesh and Ramesh having contributed larger amounts of capital, desire that the profits should be distributed in the ratio of their capital contribution but Suresh does not agree. State how you will settle this dispute if the partner approach you for the purpose.

SOLUTION (a) In the absence of partnership deed. provisions of the Indian Partnership Act 1932 would apply. no interest on partner’s capital would be allowed. Ramesh and Suresh both are…

Continue ReadingMahesh, Ramesh and Suresh are partners in a firm. They do not have a Partnership Deed. At the end of the first year of the business. they 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) Mahesh and Ramesh want that Suresh should pay interest on loan given to him by the firm but Suresh does not agree. (d) Mahesh and Ramesh having contributed larger amounts of capital, desire that the profits should be distributed in the ratio of their capital contribution but Suresh does not agree. State how you will settle this dispute if the partner approach you for the purpose.

From the following Balance Sheet as at 31st March, 2019 and Statement of Profit and Loss for the year ended 31st March, 2019 of RSB Ltd. and additional information, prepare Cash Flow Statement:  

ParticularsNote No.31st March, 2019Amount (Rs.)31st March, 2018Amount (Rs.)I. EQUITY AND LIABILITIES   1. Shareholders' Funds       (a) Share Capital7,50,0005,00,000       (b) Reserves and Surplus19,50,0003,00,0002. Non-Current Liabilities    Long-term Borrowings (5% Debentures)7,00,0004,00,0003. Current Liabilities    (a)…

Continue ReadingFrom the following Balance Sheet as at 31st March, 2019 and Statement of Profit and Loss for the year ended 31st March, 2019 of RSB Ltd. and additional information, prepare Cash Flow Statement:  

From the following Balance Sheet of Samta Ltd., as at 31st March, 2019, prepare Cash Flow Statement:

ParticularsNote No.31st March, 2019Amount (Rs.)31st March,2018Amount (Rs.)I. EQUITY AND LIABILITIES1. Shareholders' Funds(a) Share Capital17,50,0007,50,000(b) Reserves and Surplus23,10,000(20,000)2. Non-Current Liabilities Long-term Borrowings (8% Debentures)2,60,0001,50,0003. Current Liabilities(a) Short-term Borrowings (8% Bank Loan)40,00050,000(b) Trade…

Continue ReadingFrom the following Balance Sheet of Samta Ltd., as at 31st March, 2019, prepare Cash Flow Statement:

From the following Balance Sheet and information of Sun Ltd., prepare Cash Flow Statement:

ParticularsNote No.31st March, 2019Amount (Rs.)31st March, 2018Amount (Rs.)I. EQUITY AND LIABILITIES1. Shareholders' Funds(a) Share Capital17,00,0006,00,000(b) Reserves and Surplus24,10,0002,00,0002. Non-Current LiabilitiesLong-term Borrowings: 10% Debentures3,00,0002,00,0003. Current Liabilities(a) Trade Payables1,40,00060,000Total15,50,00010,60,000II. ASSETS1. Non-Current Assets(a) Fixed…

Continue ReadingFrom the following Balance Sheet and information of Sun Ltd., prepare Cash Flow Statement: