Fena sent out certain goods to Kena of Delhi. 1/10 of the goods were lost in transit. Invoice value of goods lost Rs 25,000. Invoice value of goods sent out on consignment will be:
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Solution
Invoice value of the goods lost = 1/10th of the total invoice value of the goods sent = 25,000
Thus total invoice value of the goods sent = 25,000 × 10 = Rs. 2,50,000
As per Section 37 of the Indian Partnership Act, 1932, the executors would be entitled at their choice to the interest calculated from the date of death of a partner till the date of payment on the final amount due to the dead partner at ________ percent per annum.
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Solution
6% rate is allowed as per Indian Partnership Act.
Asha Ltd. issued shares of Rs. 100 each at a premium of 25%. Mamta, who has 2,000 shares of Asha Ltd., failed to pay first and final call of Rs.5. Premium was taken by Asha Ltd. at the time of allotment. On forfeiture of Mamta’s shares, the amount to be debited to securities premium account will be
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Solution
A partnership firm maintains its accounts on calendar year basis. B, one of its partner died on 31st March 2010. The profit for the year 2009 was Rs. 75,000, which was distributed among all the three partners equally. The share of profit of B for the year 2010 on the basis of the year 2009 will be
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Solution
On the death of a partner, the representatives are entitled to Share of profit upto the date of death.
Thus share in profits for the period 1st April 2010 to 30th June 2010 to be credited to D’s Account will be calculated as follows:
Profit for the period on the basis of last year’s profit will be 75,000 × 3/12 = Rs. 18,750
Share of D in profit = 1/3 of 18,750 = Rs. 6,250
Brave Ltd. issued 60,000 shares of Rs. 9 each at par. The application money was Rs. 2, allotment money was Rs. 4, and first call was of Re.1. The amount of final call will be
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Solution
Total value per share 9 RS.
Application money 2 RS.
Allotment money 4 RS.
First call 1 RS.
Final call (9 – 2 – 4 – 1) 2 RS.
In a joint venture between Ansh and Vansh, Ansh purchased goods costing Rs.2,40,000. Vansh sold goods costing Rs 1,60,000 at Rs 2,40,000. Balance goods were taken over by Ansh at same gross profit percentage as in case of sale. The amount of goods taken over will be:
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Solution
The cost of the goods sold = 1,60,000
Sale price of the goods sold = 2,40,000
Profit on sale = 2,40,000 – 1,60,000 = 80,000
Profit margin on cost = profit/cost × 100 = (80000/160000) × 100 = 50%
Cost of the goods taken over by B = total goods-goods sold = 2,40,000 – 1,60,000 = 80,000
Amount at which the goods are taken over by B = 80,000 + 50% of 80,000 = Rs. 1,20,000
Atul, Vipul and Prafful are partners in a firm with no partnership agreement. They invested Rs.1,00,000, Rs.75,000 and Rs.50,000 as capital in the firm. The profit for the year was Rs.2,50,000. Prafful demands interest on loan of Rs.20,000 advanced by him at the market rate of interest which is 12% p.a. The amount of interest to be received by him will be
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Solution
Partners are entitled to receive interest at an agreed rate of interest on any Loan given by them to the firm. Interest on Loan is a charge against profits so a partner is entitled to receive interest whether there are profits or not. If there is no agreement regarding the rate of interest, it is taken as 6% p.a.
So as nothing is mentioned in the deed of partnership regarding the interest on loan so interest on Prafful’s loan will be paid at 6% pa.
Interest on Prafful’s loan will be = 6% of 20,000 = Rs. 1,200
A second hand car is purchased for Rs. 2,00,000, the amount of Rs. 25,000 is spent on its repairs, Rs. 5,000 is incurred to get the car registered in owner’s name and Rs. 2,000 is paid as dealer’s commission. The amount debited to car account will be
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Solution
The cost of acquisition includes the purchase cost plus any reasonable costs incurred in placing the asset into a position where it is ready for use.
So the amount debited to car account will be = purchase cost + initial repairs + registration + dealers commission = 2,00,000 + 25,000 + 5,000 + 2,000 = Rs. 2,32,000
A, B and C are in partnership with no partnership deed. A brought Rs.80,000, B Rs.60,000 and C Rs.40,000 as capital. A does not take part in day to day activities, B acts as general manger and C acts as a sales manager. The profit during the year was Rs. 1,50,000. The share of each partner in profit will respectively be
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Solution
By profit sharing ratio in a partnership firm, we mean the ratio in which the profits and losses of the firm are to be distributed amongst the partners.
In the absence of a partnership deed and where there is no indication as to the agreement between the
partners in this aspect, it should be considered as equal share for all partners.
Thus the profits Rs. 1,50,000 will be shared among the partners equally i.e.
A Rs. 50,000
B Rs. 50,000
C Rs. 50,000
Y Ltd. sends out its goods Rs. 1,20,000 to one of its dealer on Sale or Return basis. On 31st March he received an approval letter for goods of Rs. 80,000. Y Ltd. charge 25% profit on cost. The cost price of the unapproved goods with the dealer will be
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Solution
When goods are sent on approval basis then at the end of the financial year the goods lying with customers will be valued at cost or market price whichever is less.
Goods sent out on sale or return basis = 1,20,000
Approval letter received for goods worth Rs. 80,000
Goods still lying with the dealer = 1,20,000 – 80,000 = 40,000
So cost of goods lying with the dealer = 40,000 × 100/125 = Rs. 32,000