CA Foundation · Principles and Practice of Accounting

Partnership Accounts

23 practice questions, each with the answer and an explanation.

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Random questions from this topic, one at a time. You see the answer and the explanation straight after each one.

All 23 questions

  1. A firm's average annual profit is Rs 60,000. If goodwill is valued at 3 years' purchase of the average profit, what is the value of goodwill?
  2. A partner withdrew Rs 80,000 for 9 months in a year. What is the interest on drawings at 8% per annum?
  3. A partner withdrew Rs 80,000 for 9 months in a year. What is the interest on drawings at 6% per annum?
  4. A partner withdrew Rs 200,000 for 4 months in a year. What is the interest on drawings at 12% per annum?
  5. A firm earns an average profit of Rs 100,000 on capital employed of Rs 600,000. The normal rate of return is 12%. What is the goodwill at 3 years' purchase of super profit?
  6. A firm earns an average profit of Rs 80,000 on capital employed of Rs 300,000. The normal rate of return is 15%. What is the goodwill at 2 years' purchase of super profit?
  7. A firm earns an average profit of Rs 120,000 on capital employed of Rs 300,000. The normal rate of return is 15%. What is the goodwill at 2 years' purchase of super profit?
  8. A and B share profits in the ratio 4 : 3 and admit C for a 1/4 share, which they give up in their old ratio. What is A's new share?
  9. A firm earns an average profit of Rs 80,000 on capital employed of Rs 600,000. The normal rate of return is 12%. What is the goodwill at 5 years' purchase of super profit?
  10. A firm earns an average profit of Rs 60,000 on capital employed of Rs 300,000. The normal rate of return is 12%. What is the goodwill at 4 years' purchase of super profit?
  11. A firm earns an average profit of Rs 100,000 on capital employed of Rs 400,000. The normal rate of return is 10%. What is the goodwill at 4 years' purchase of super profit?
  12. A firm's average annual profit is Rs 60,000. If goodwill is valued at 2 years' purchase of the average profit, what is the value of goodwill?
  13. A firm's average annual profit is Rs 50,000. If goodwill is valued at 3 years' purchase of the average profit, what is the value of goodwill?
  14. A firm's average annual profit is Rs 80,000. If goodwill is valued at 4 years' purchase of the average profit, what is the value of goodwill?
  15. A partner withdrew Rs 80,000 for 12 months in a year. What is the interest on drawings at 6% per annum?
  16. A partner withdrew Rs 200,000 for 9 months in a year. What is the interest on drawings at 10% per annum?
  17. A and B share profits in the ratio 5 : 3. C is admitted for a 1/5 share, taken from A and B in their old ratio. What is the sacrifice of A?
  18. A firm earns an average profit of Rs 60,000 on capital employed of Rs 500,000. The normal rate of return is 10%. What is the goodwill at 2 years' purchase of super profit?
  19. A and B share profits in the ratio 2 : 1. C is admitted for a 1/5 share, taken from A and B in their old ratio. What is the sacrifice of A?
  20. A and B share profits in the ratio 2 : 1 and admit C for a 1/4 share, which they give up in their old ratio. What is A's new share?
  21. A firm earns an average profit of Rs 60,000 on capital employed of Rs 400,000. The normal rate of return is 10%. What is the goodwill at 4 years' purchase of super profit?
  22. A and B share profits in the ratio 3 : 2. C is admitted for a 1/5 share, taken from A and B in their old ratio. What is the sacrifice of A?
  23. A firm earns an average profit of Rs 100,000 on capital employed of Rs 500,000. The normal rate of return is 15%. What is the goodwill at 2 years' purchase of super profit?

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