Profit And Loss Account

01

PYQ 2025

hard

accountancy ID: cbse-cla

Sonia and Shruti were partners in a firm sharing profits and losses in the ratio of 5 : 3. On 1st April, 2023 the balance in their fixed capital accounts were \u20b9 25,00,000 and \u20b9 15,00,000 respectively. The profit of the firm for the year ended 31st March, 2024 was \u20b9 24,00,000. Calculate their share of profit if : (i) the partnership deed is silent as to the payment of interest on capital. (ii) the partnership deed provides for interest on capital @ 10% per annum.

02

PYQ 2025

hard

accountancy ID: cbse-cla

Abhay and Sujoy entered into partnership on 1st April, 2024 with capitals of \u20b9 80,00,000 and \u20b9 60,00,000 respectively. The partners decided to share profits in the ratio of their capital contribution. They withdrew \u20b9 6,00,000 and \u20b9 4,00,000 respectively during the year. The partners were charged interest on drawings @ 10% per annum as per the provisions of the partnership deed. Abhay\u2019s share of profit was guaranteed by Sujoy at a minimum of \u20b9 3,50,000 per annum. The profit of the firm for the year ended 31st March, 2024 amounted to \u20b9 6,50,000. Prepare Profit and Loss Appropriation Account of the firm for the year ended 31st March, 2024.

Official Solution

Correct Option: (1)

Step 1: Interest on Drawings Abhay: 10% of ₹6,00,000 = ₹60,000 Sujoy: 10% of ₹4,00,000 = ₹40,000 Step 2: Profit Available for Distribution Net Profit = ₹6,50,000 + ₹60,000 + ₹40,000 = ₹7,50,000 (after charging drawings interest) Step 3: Profit Sharing Ratio Abhay : Sujoy = ₹80,00,000 : ₹60,00,000 = 4 : 3 Abhay's share = (4/7) \times ₹7,50,000 = ₹4,28,571 (approx) Sujoy's share = (3/7) \times ₹7,50,000 = ₹3,21,429 Step 4: Check Guarantee Clause Abhay's actual share (₹4,28,571) is more than the guaranteed amount (₹3,50,000), so no adjustment needed . Profit and Loss Appropriation Account Particulars Amount (₹) Particulars Amount (₹) To Abhay's Capital A/c 4,28,571 By Net Profit 6,50,000 To Sujoy's Capital A/c 3,21,429 By Interest on Drawings: Abhay - 60,000 Sujoy - 40,000 Total 7,50,000 Total 7,50,000 Final Answer: Abhay gets ₹4,28,571, Sujoy gets ₹3,21,429; no guarantee adjustment needed .

Particulars	Amount (₹)	Particulars	Amount (₹)
To Abhay's Capital A/c	4,28,571	By Net Profit	6,50,000
To Sujoy's Capital A/c	3,21,429	By Interest on Drawings:	Abhay – 60,000
		Sujoy – 40,000
Total	7,50,000
Total	7,50,000

03

PYQ 2025

hard

accountancy ID: cbse-cla

Bittu and Chintu were partners in a firm sharing profit and losses in the ratio of 4:3. Their Balance Sheet as at 31st March, 2024 was as On April, 2024, Diya was admitted in the firm for share in the profits on the following terms: New profit sharing ratio between Bittoo, Chintoo and Diya will be . Fixed Assets were found to be overvalued by ₹ 1,40,000. Creditors were paid ₹ 4,20,000 in full settlement. Diya brought proportionate capital and ₹ 5,60,000 as her share of goodwill premium by cheque. Prepare Revaluation Account and Partners' Capital Accounts.

Official Solution

Correct Option: (1)

Particulars	Amount (₹)	Particulars	Amount (₹)
To Fixed Assets	1,40,000	To Creditors	70,000
		To General Reserve	2,10,000
		Profit on Revaluation:
To Bittu (4/7)	60,000
To Chintu (3/7)	45,000
Total	2,45,000	Total	2,80,000

Debit Side	Credit Side
Particulars	Bittu (₹)	Chintu (₹)	Diya (₹)	Particulars	Bittu (₹)	Chintu (₹)	Diya (₹)
To Balance c/d	11,85,714	8,59,286	1,40,000	By Balance b/d	8,00,000	6,00,000
				By General Reserve	1,20,000	90,000
				By Profit on Revaluation	60,000	45,000
				By Bank (Diya's capital)			5,60,000
				By Premium for Goodwill	5,60,000	0
Total	11,85,714	8,59,286	1,40,000	Total	15,40,000	7,35,000	5,60,000

04

PYQ 2025

hard

accountancy ID: cbse-cla

Simar, Tanvi and Umara were partners in a firm sharing profits and losses in the ratio of 5:6:9. On 31st March, 2024 their Balance Sheet was as follows: Umara died on 30th June, 2024. The partnership deed provided for the following on the death of a partner:

Official Solution

Correct Option: (1)

Journal Entries for Dissolution of the Firm Date Particulars L.F. Debit (₹) Credit (₹) (i) Sachin's Capital A/c 72,000 To Realisation A/c 72,000 (Sachin took over stock at a discount of 10%) (ii) Realisation A/c 70,000 To Virat's Capital A/c 65,000 To Bank A/c 5,000 (Creditors of ₹70,000 taken over by Virat at ₹65,000) (iii) Realisation A/c 3,00,000 To Bank A/c 3,00,000 (Rohit took over his wife's loan) (iv) Bank A/c 10,000 To Realisation A/c 10,000 (Old typewriter realised) (v) Bank A/c 66,50,000 To Realisation A/c 70,00,000 Realisation A/c 3,50,000 To Bank A/c 3,50,000 (Land and Building sold for ₹70,00,000 through a broker; 5% commission paid) (vi) Sachin's Capital A/c 10,000 Virat's Capital A/c 10,000 Rohit's Capital A/c 10,000 To Realisation A/c 30,000 (Loss on realisation distributed equally) Calculations: (i) Sachin took over stock: ₹80,000 - (10% of ₹80,000) = ₹80,000 - ₹8,000 = ₹72,000 (ii) Virat agreed to take over creditors: Creditor value = 70,000 Settlement Price = 65,000 Additional Payment for liability on Realisation account = 5,000 (v) Land and Building sale: Amount Received = 70,00,000 Commission amount = 70,00,000 \times 5% = 3,50,000 Net amount = 70,00,000 - 3,50,000 = 66,50,000 (vi) Realisation Loss: Equal distribution for Sachin = 30,000 \div 3 = 10,000 Equal distribution for Virat = 30,000 \div 3 = 10,000 Equal distribution for Rohit = 30,000 \div 3 = 10,000 Explanation: Taking over assets/liabilities: When a partner takes over an asset or agrees to pay a liability, their capital account is adjusted. The Realisation account is used to reflect the transaction. Sale of Assets: Money Received is credited to realisation and deducted from brokers commission (if they charge brokerage commission). Distribution of Realisation Loss: The loss is distributed between the partners in their profit-sharing ratio (stated as equal in the given question), which reduces their capital balances.

Date	Particulars	Debit (₹)	Credit (₹)
(i)	Sachin's Capital A/c	72,000
	To Realisation A/c		72,000
(Sachin took over stock at a discount of 10%)
(ii)	Realisation A/c	70,000
	To Virat's Capital A/c		65,000
	To Bank A/c		5,000
(Creditors of ₹70,000 taken over by Virat at ₹65,000)
(iii)	Realisation A/c	3,00,000
	To Bank A/c		3,00,000
(Rohit took over his wife's loan)
(iv)	Bank A/c	10,000
	To Realisation A/c		10,000
(Old typewriter realised)
(v)	Bank A/c	66,50,000
	To Realisation A/c		70,00,000
	Realisation A/c	3,50,000
	To Bank A/c		3,50,000
(Land and Building sold for ₹70,00,000 through a broker; 5% commission paid)
(vi)	Sachin's Capital A/c	10,000
	Virat's Capital A/c	10,000
	Rohit's Capital A/c	10,000
	To Realisation A/c		30,000
(Loss on realisation distributed equally)

05

PYQ 2025

hard

accountancy ID: cbse-cla

Aakash and Baadal entered into partnership on 1 st October, 2023 with the capitals of ₹ 80,00,000 and ₹ 60,00,000 respectively. They decided to share profits and losses equally. Partners were entitled to interest on capital @ 10% per annum as per the provisions of the partnership deed. Baadal is given a guarantee that his share of profit, after charging interest on capital will not be less than ₹ 7,00,000 per annum. Any deficiency arising on that account shall be met by Aakash. The profit of the firm for the year ended 31 st March, 2024 amounted to ₹ 13,00,000. Prepare Profit and Loss Appropriation Account for the year ended 31 st March, 2024.

06

PYQ 2025

medium

accountancy ID: cbse-cla

Sakshi, Kiara and Gunjan were partners in a firm sharing profits and losses in the ratio of 3:2:1. Kiara retired on 1-4-2023. After all adjustments the amount due to Kiara was Rs 5,00,000. The payment was to be made in two yearly instalments of Rs 2,50,000 each plus interest @ 10 per annum on the unpaid balance. The amount of first instalment paid on 31-03-2024 will be:

1

Rs 3,00,000

2

Rs 2,75,000

3

Rs 5,50,000

4

Rs 2,50,000

07

PYQ 2025

medium

accountancy ID: cbse-cla

Ishan, Jatin and Kapil were partners in a firm sharing profits and losses in the ratio of 5:4:1. Jatin retired and his share was taken up by Ishan and Kapil in the ratio 1:1. The new profit-sharing ratio between Ishan and Kapil after Jatin's retirement will be:

1

5:1

2

1:1

3

5:4

4

7:3

08

PYQ 2025

medium

accountancy ID: cbse-cla

Preet and Saral were partners sharing profits and losses in the ratio of 3:2. On 31st March, 2024 they decided to change their profit sharing ratio to 1:1. On the date of reconstitution goodwill of the firm was valued at Rs 1,00,000. The journal entry for treatment of goodwill on account of change in profit-sharing ratio will be:

1

Preet's Capital A/c Dr. 1,00,000 To Saral's Capital A/c 1,00,000

2

Saral's Capital A/c Dr. 1,00,000 To Preet's Capital A/c 1,00,000

3

Preet's Capital A/c Dr. 10,000 To Saral's Capital A/c 10,000

4

Saral's Capital A/c Dr. 10,000 To Preet's Capital A/c 10,000

09

PYQ 2025

medium

accountancy ID: cbse-cla

Anisha, Deepa, and Charu were partners sharing profits and losses in the ratio of 5:3:2. On 31st March 2024, they decided to change their profit-sharing ratio to 2:3:5. Each partner's gain or sacrifice due to the change in profit-sharing ratio will be:

1

Anisha’s sacrifice; Charu’s gain

2

Anisha’s gain; Charu’s sacrifice

3

Anisha’s sacrifice; Deepa’s gain

4

Deepa’s gain; Charu’s sacrifice

10

PYQ 2025

medium

accountancy ID: cbse-cla

Pulkit and Ravinder were partners in a firm sharing profits and losses in the ratio of 3:2. Sikander was admitted as a new partner for a share in the profits of the firm. Pulkit, Ravinder, and Sikander decided to share future profits in the ratio of 2:2:1. Sikander brought Rs 5,00,000 as his capital and Rs 10,00,000 as his share of premium for goodwill. The amount of premium for goodwill that will be credited to the old partners' capital accounts will be:

1

Pulkit’s Capital Account Rs 10,00,000

2

Pulkit’s Capital Account Rs 6,00,000 and Ravinder’s Capital Account Rs 4,00,000

3

Pulkit’s Capital Account Rs 5,00,000 and Ravinder’s Capital Account Rs 5,00,000

4

Pulkit’s Capital Account Rs 2,00,000

11

PYQ 2025

easy

accountancy ID: cbse-cla

Simar, Tanvi, and Umara were partners in a firm sharing profits and losses in the ratio of 5 : 6 : 9. On 31 st March, 2024, their Balance Sheet was as follows: Balance Sheet of Simar, Tanvi, and Umara as at 31 st March, 2024 Liabilities Amount (₹) Assets Amount (₹) Capitals: Fixed Assets 25,00,000 Simar 13,00,000 Stock 10,00,000 Tanvi 12,00,000 Debtors 8,00,000 Umara 14,00,000 Cash 7,00,000 General Reserve 7,00,000 Profit and Loss A/c 2,00,000 Trade Payables 6,00,000 Total 52,00,000 Total 52,00,000 Umara died on 30 th June, 2024. The partnership deed provided for the following on the death of a partner: Goodwill of the firm be valued at 3 years purchase of average profits for the last 5 years. The profits/losses for the previous four years were: 2022-23: ₹ 3,10,000 (loss) 2021-22: ₹ 3,00,000 (profit) 2020-21: ₹ 4,00,000 (profit) 2019-20: ₹ 2,50,000 (profit) Umara’s share of profit or loss till the date of her death was to be calculated on the basis of profit or loss for the year ended 31 st March 2024. Calculate Goodwill of the firm. Pass the necessary journal entry for the treatment of goodwill on Umara’s death. Calculate Umara’s share in the profit or loss of the firm till the date of her death. Pass the necessary journal entry to record Umara’s share of profit or loss till the date of her death.

12

PYQ 2025

medium

accountancy ID: cbse-cla

From the following information, prepare a Comparative Statement of Profit and Loss for the year ended March, 2024 : Particulars 2023-24 (₹) 2022-23 (₹) Revenue from operations 8,00,000 4,00,000 Cost of revenue from operations 4,00,000 2,00,000 Employee benefit expenses 1,60,000 80,000 Tax Rate 50% (a) From the following information, calculate Opening Trade Receivables and Closing Trade Receivables : Trade Receivables Turnover Ratio = 4 times Closing Trade Receivables were ₹ 20,000 more than that in the beginning. Cost of Revenue from operations = ₹ 6,40,000. Cash Revenue from operations = of Credit Revenue from Operations Gross Profit Ratio = 20%

High-Yield Trend

Chapter Questions
12 MCQs

Official Solution

Official Solution

Step 1: Interest on Drawings

Step 2: Profit Available for Distribution

Step 3: Profit Sharing Ratio

Step 4: Check Guarantee Clause

Profit and Loss Appropriation Account

Official Solution

Revaluation Account and Partners' Capital Accounts

1. Revaluation Account

Explanation:

2. Partners' Capital Accounts

Explanation:

Official Solution

Calculations:

Explanation:

Official Solution

Profit and Loss Appropriation Account

Official Solution

Official Solution

Official Solution

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Official Solution

Step-by-Step Solution

Conclusion:

Balance Sheet of Simar, Tanvi, and Umara as at 31^st March, 2024

Official Solution

Official Solution

Liabilities	Amount (₹)	Assets	Amount (₹)
Capitals:		Fixed Assets	25,00,000
Simar	13,00,000	Stock	10,00,000
Tanvi	12,00,000	Debtors	8,00,000
Umara	14,00,000	Cash	7,00,000
General Reserve	7,00,000	Profit and Loss A/c	2,00,000
Trade Payables	6,00,000
Total	52,00,000	Total	52,00,000

Particulars	2023-24 (₹)	2022-23 (₹)
Revenue from operations	8,00,000	4,00,000
Cost of revenue from operations	4,00,000	2,00,000
Employee benefit expenses	1,60,000	80,000
Tax Rate	50%

Profit And Loss Account

High-Yield Trend

Chapter Questions 12 MCQs

Official Solution

Official Solution

Step 1: Interest on Drawings

Step 2: Profit Available for Distribution

Step 3: Profit Sharing Ratio

Step 4: Check Guarantee Clause

Profit and Loss Appropriation Account

Official Solution

Revaluation Account and Partners' Capital Accounts

1. Revaluation Account

Explanation:

2. Partners' Capital Accounts

Explanation:

Official Solution

Calculations:

Explanation:

Official Solution

Profit and Loss Appropriation Account

Official Solution

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Official Solution

Official Solution

Official Solution

Step-by-Step Solution

Conclusion:

Balance Sheet of Simar, Tanvi, and Umara as at 31st March, 2024

Official Solution

Official Solution

Chapter Questions
12 MCQs

Balance Sheet of Simar, Tanvi, and Umara as at 31^st March, 2024