Quantitative Aptitude

Partnership

842 Questions
All Capital changes, admission, and withdrawal 249 Compound partnership and time-weighted capital 186 Absolute profit or percentage difference to ratio 126 Simple partnership 100 Working and sleeping partners 79 Retirement and gaining ratio 63 Interest on capital and fixed allowances 39

Partnership Questions

Multiple choice general knowledge math & puzzles

A and B started a partnership business investing some amount in the ratio of 3 : 5. C joined then after six months with an amount equal to that of B. In what proportion should the profit at the end of one year be distributed among A, B and C?

  1. 6:10:3

  2. 6:7:8

  3. 6:10:5

  4. Data inadequate
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

A and B invest for 12 months in ratio 3:5. C invests 5 units for 6 months. Ratio of profit = (3*12) : (5*12) : (5*6) = 36 : 60 : 30. Dividing by 6 gives 6 : 10 : 5.

Multiple choice general knowledge math & puzzles

Three partners A, B and C invest Rs 1600, Rs 1800 and Rs 2300 respectively in a business. How should they divide a profit of Rs 399?

  1. 116, 130, 153

  2. 112, 126, 161

  3. 110, 120, 169

  4. 113, 127, 159
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Profit is divided in investment ratio 1600:1800:2300 = 16:18:23. Total parts = 57. A's share = (16/57)×399 = 112, B's share = (18/57)×399 = 126, C's share = (23/57)×399 = 161. Verify: 112+126+161 = 399.

Multiple choice general knowledge math & puzzles

Mr Sumit, Mr Punit and Mr Sanjay are partners in a business. Mr Sumit started the business with Rs 40,000. After 3 months, Mr Sanjay and Punit joined him with Rs 60,000 each. If the total profits at the end of the year amount to Rs 31,200, what would be Sanjay share in it?

  1. 15600

  2. 9600

  3. 10800

  4. 21600
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Profit ratio based on investment × time. Sumit: 40000 × 12 = 480000. Sanjay and Punit: 60000 × 9 = 540000 each. Total ratio units = 480000 + 540000 + 540000 = 1560000. Sanjay's share = (540000/1560000) × 31200 = 10800.

Multiple choice

A and B are partners with capitals of Rs. 20, 000 and 40, 000 respectively and sharing profit equally. They admitted C as their third partner with one - fourth profit of the firm on the payment of Rs. 24, 000. The amount of hidden goodwill is

  1. Rs. 12, 000

  2. Rs. 2,000

  3. Rs. 16, 000

  4. none of these
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Hidden goodwill is the difference between what C pays and his proportionate share of the firm's capital. Total capital before C = 20,000 + 40,000 = 60,000. C is entitled to 1/4 share, so expected capital = 60,000 × 1/3 = 20,000. But C pays 24,000, so hidden goodwill = 24,000 - 20,000 = 4,000. Since C gets 1/4 profit, goodwill is shared by old partners in their sacrificing ratio (equal), so hidden goodwill = 4,000 × 3 = 12,000. Alternatively, based on total capital after admission = 84,000, C's 1/4 share = 21,000, so hidden goodwill = 24,000 - 21,000 = 3,000, which gets adjusted among old partners.

Multiple choice

Goodwill bought in by incoming partner in cash for joining in a partnership firm is taken away by the old partners in

  1. Old Profit Sharing Ratio

  2. New Profit Sharing Ratio

  3. Sacrificing Ratio

  4. Capital Ratio
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Goodwill brought in by an incoming partner is distributed to old partners in their sacrificing ratio, not old or new profit sharing ratios. The sacrificing ratio represents the extent to which each old partner has given up their share in favor of the new partner. Capital ratio is irrelevant to goodwill distribution.

Multiple choice

A and B are partners sharing profit and loss in the ratio of 3 : 2 (A's capital is Rs. 60, 000 and B's capital is Rs. 30, 000). They admit C and agreed to give 1/5th share of profit to him. How much should C bring in towards his capital?

  1. Rs. 18, 000

  2. Rs. 24,000

  3. Rs. 29, 000

  4. Rs. 22, 500
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Total capital of A and B = 60,000 + 30,000 = 90,000. C gets 1/5 share, so the remaining 4/5 belongs to A and B. The total firm capital based on C's proportionate share would be 90,000 ÷ (4/5) = 1,12,500. Therefore, C's capital = 1,12,500 × 1/5 = 22,500. Alternatively, C should bring capital in the same ratio as his profit share relative to the old partners' combined capital.

Multiple choice

A and B enter into a joint venture sharing profit and loss in ratio 3 : 2. A purchased goods costing Rs. 2, 00, 000. B sold 95% goods for Rs. 2, 50, 000. A is entitled to get 1% commission on purchase and B is entitled to get 5% commission on sales. Remaining goods are stolen. A's share of profit is

  1. Rs. 15,300

  2. Rs. 21,300

  3. Rs. 18, 900

  4. none of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Profit for the Joint Venture = Rs{(2,50,000 + 10,000)-(2,00,000+2000+12500+10,000)}                                                 = Rs 25500 A's Share of profit                 = (3/5)*25,500                                                  = Rs 15,300 

Rs 10,000 being the amount of goods stolen.

Multiple choice

(i) X and Y enter into a joint venture sharing profit & loss in the ratio of 3 : 2. (ii) X is entitled to get 1% commission on purchase and Y is entitled to get 5% commission on sales. (iii) X purchased goods for Rs. 4, 00, 000 and sent the same to Y. Supplier allowed a cash discount of 5%. (iv) X drew a bill on Y for an amount equivalent to 80% of the original cost of goods. X got it discounted at Rs. 3, 00, 000. (v) Y sold 50% goods for Rs. 5, 00, 000 and paid Rs. 4, 000 towards selling & administration expenses and insurance and Rs. 1, 000 still outstanding. Y allowed a cash discount of 5% to a customer to whom goods were sold for Rs. 2, 00, 000. Bad debts amounted to Rs. 16, 000. (vi) 50% of balance goods are taken over by Y at 60% of cost. (vii) Remaining goods were destroyed by fire and insurance claim was received by Y to the extent of 60%.

The profit in the joint venture is

  1. Rs. 1, 80, 000

  2. Rs. 1, 60, 000

  3. Rs. 1, 40, 000

  4. none of these
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Profit = (5,00,000+60,000+60,000)-(4,00,000+4,000+25,000+4,000+1,000+10,000+16,000)           = Rs 160,000

Multiple choice

A, B and C are partners sharing profits in the ratio 2 : 2 : 1. On retirement of B, goodwill was valued as Rs. 30000. What is the contribution of A and C to compensate B?

  1. Rs. 20000 and Rs. 10000

  2. Rs. 8000 and Rs. 4000

  3. Rs. 800 and Rs. 4000

  4. Rs. 15000 and Rs. 15000

  5. No contribution <o:p> </o:p>
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation
Amount of B's share of the goodwill of the firm = 30000*2/5 = Rs. 12000

A's contribution = 12000*2/3 = Rs. 8000 B's contribution = Rs. 12000*1/3 = Rs. 4000| | | | | | | | | | | | | | | | | | | | | | |

Multiple choice

A, B and C are partners in the firm sharing profits and loss in 5 : 3 : 2 ratio. The firm's balance sheet as on 31.3.2006 shows the reserve balance of Rs. 25,000, profit of the last year Rs. 50,000, Joint Life policy of Rs.10,00,000, fixed assets of Rs. 12,00,000. On 1st June, C died and on the same date assets were revalued. The executor of the deceased partner will get along with the capital of C

  1. share in the reserves account the firm.

  2. proportionate share of profit upto the date of death.

  3. share in joint life policy.

  4. all of these.
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

When a partner dies, their executor is entitled to multiple payments: (1) The deceased partner's capital account balance, (2) Their proportionate share in accumulated reserves and profits (since these belong to all partners), (3) Their share in the joint life policy (which benefits partners), and (4) Their share of revaluation profits/losses. All of these amounts are calculated as of the date of death and paid to the executor.