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CA Foundation Partnership Accounts — practice questions

Explore 60 free Partnership Accounts questions in CA Foundation Accounting. Open each question or exercise to read its content, reference answers and available explanation.

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Partnership Accounts questions and exercises with answers

Showing questions 1–30 of 60.

With no partnership contract, how are profits shared under the Partnership Act?Read the answer and worked solution →Absent any contract, what is a partner's right to remuneration for running the firm?Read the answer and worked solution →Absent contract, interest on a partner's advance beyond his capital is at what rate?Read the answer and worked solution →Absent contract, from what source can interest on partners' capital be paid?Read the answer and worked solution →A partner lends Rs 50,000 beyond capital for a year, no agreement. Interest due?Read the answer and worked solution →Whose consent is needed to introduce a new partner, subject to contract?Read the answer and worked solution →A newly introduced partner is liable for firm acts done before he joined?Read the answer and worked solution →Until what event does a retired partner stay liable to third parties for later firm acts?Read the answer and worked solution →When can a majority of partners lawfully expel a partner?Read the answer and worked solution →A partner adjudicated insolvent ceases to be a partner from which date?Read the answer and worked solution →If the firm continues after a partner's death, is his estate liable for later acts?Read the answer and worked solution →An outgoing partner's estate is left unpaid. What interest rate may it opt for?Read the answer and worked solution →A deceased partner's share was Rs 2,00,000, unsettled. Interest for one year?Read the answer and worked solution →If a purchase option is duly exercised, what further profit share does the outgoing partner get?Read the answer and worked solution →Subject to contract, a firm is dissolved on the death of a partner under which section?Read the answer and worked solution →A firm formed for a fixed term is dissolved, subject to contract, when?Read the answer and worked solution →On settling accounts after dissolution, which payment ranks first?Read the answer and worked solution →After dissolution, losses are met first out of what?Read the answer and worked solution →In settling a dissolved firm's accounts, how is goodwill treated, subject to contract?Read the answer and worked solution →After goodwill is sold, a selling partner agrees not to run a similar business. When is the restraint valid?Read the answer and worked solution →Who indemnifies a partner for liabilities incurred in the ordinary conduct of business?Read the answer and worked solution →A partner whose wilful neglect causes the firm a loss must do what?Read the answer and worked solution →A partner brings cash into a firm. What is the entry on his investment?Read the answer and worked solution →A partner brings a non-cash asset. At what value is his capital account credited?Read the answer and worked solution →A partner brings equipment worth Rs 80,000 with a Rs 30,000 loan assumed. Capital credit?Read the answer and worked solution →What does a partner's capital account represent?Read the answer and worked solution →Which event increases a partner's capital account?Read the answer and worked solution →In a partnership, compensation for capital invested is given as what?Read the answer and worked solution →At period end, how is a partner's drawing account treated?Read the answer and worked solution →What defines a guaranteed payment to a partner?Read the answer and worked solution →

Worked practice questions

With no partnership contract, how are profits shared under the Partnership Act?

  1. Capital ratio basis
  2. Equally among all
  3. Work done basis
  4. Loan ratio basis
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Correct answer: B. Equally among all

The default rule in Section 13 is equal sharing of profits and equal contribution to losses when the partners have not agreed otherwise.

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Absent any contract, what is a partner's right to remuneration for running the firm?

  1. A salary of one month
  2. A fixed monthly sum
  3. A share of turnover
  4. No remuneration
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Correct answer: D. No remuneration

Section 13 says that subject to contract a partner cannot claim pay for taking part in the conduct of the business.

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Absent contract, interest on a partner's advance beyond his capital is at what rate?

  1. 4% p.a.
  2. 5% p.a.
  3. 8% p.a.
  4. 6% p.a.
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Correct answer: D. 6% p.a.

Section 13 fixes interest at six percent per annum on payments or advances beyond the agreed capital.

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More Accounting topics

Final Accounts of Sole ProprietorsAccounting ConceptsBills of Exchange and Promissory NotesCompany AccountsDepreciation and AmortisationInventoriesPartnershipBank Reconciliation Statement