What is meant by unlimited liability of a partner ?

State the provisions of Indian Partnership Act, 1932 regarding interest on parther's capital and interest on partner's loan when there is no partnership deed.

Ram and Mohan are partners in a firm without any partnership deed.  Their capitals are Ram Rs. 8,00,000 and Mohan  Rs. 6,00,000.  Ram is an active partner and looks after the business.  Ram wants that profit should be shared in proportion of capitals.  State with reason whether his claim is valid or not.

List two items that may appear on the credit side of a partner's fixed capital account.

Why should a firm have a partnership deed?

Why is it that the capital account of a partner does not show a 'Debit Balance' in spite of regular and consistent losses year after year?

What is meant by goodwill ?

How does the factor 'location' after the goodwill of a firm ?

K and P were partners in a firm sharing profits in 4 : 3 ratio.  Their capitals on 1.4.2009 were : K Rs. 80,000 and P Rs. 60,000.  The partnership deed provided as follows :
(i) Interest on capital and drawing will be allowed and charged @ 12% p.a. and 10% p.a. respectively.
(ii) K and P will be entitled to get monthly salary of Rs. 2,00 and Rs 3,000 respectively.
The profits for the year ended 31.3.2010 were Rs.  1,00,300.  The drawings of K and P were Rs. 40,000 and Rs. 50,000 respectively. Interest on K's drawings was Rs. 2,000 and on P's drawings Rs. 2,500.
Prepare Profit and Loss Appropriation Account of K and P for the year ended 31.3.2010 assuming that the capitals of the partners were fluctuating.

D, E and F were partners in a firm sharing profits in the ratio of 5 : 7 : 8.  Their fixed capitals were D Rs. 5,00,000, E Rs. 7,00,000. and F Rs. 8,00,000.  Their partnership deed provided for the following :
(i) Interest on capital @ 10% p.a
(ii) Salary of Rs, 10,000 per month of F.
(iii) Interest on drawings @ 12% p.a.
D withdrew Rs. 40,000 on 31st January, 2009; E withdrew Rs.  50,000 on 31st March, 2009 and F withdrew Rs. 30,000 on 31st December, 2009.
During the year ended on 31st December, 2009 the firm earned a profit of Rs. 3,50,000.
Prepare the Profit and Loss Appropriation Account for the year ended 31st December, 2009.

A, B and C were partners in a firm having capitals of Rs. 60,000; Rs. 60,000 and Rs. 80,000 respectively.  Their Current Account balances were A : Rs, 10,000; B : Rs 5,000 and C : Rs, 2,000 (Dr.). According to the partnership deed the partners were entitled to interest on capital @ 50% p.a. C being the working partner was also entitled to a salary of Rs. 6,000 p.a.
The profits were to be divided as follows:
(a) The first Rs. 20,000 in proportion to their capitals.
(b) Next Rs. 30,000 in the ratio of 5 : 3 : 2.
(c) Remaining profits to be shared equally.
The firm made a profit of Rs. 1,56,000 before charging any of the above items.  Prepare the Profit & Loss Appropriation Account and pass necessary journal entry for appropriation of profit.

A, B, C and D are partners sharing profits and losses in the ration of 4 : 3 : 3 : 2.  Their fixed capitals on 31.03.2010 were Rs. 60,000, Rs. 90,000, Rs. 1,20,000 and Rs. 90,000 respectively.  After preparing the final accounts for the year ended 31.03.2010 it was discovered that interest on capital @ 12% p.a. was not allowed and interest on drawings amounting to Rs. 2,000, Rs. 2,500, Rs. 1,500 and Rs. 1,000 respectively was also not charged.  Pass the necessary adjustment journal entry showing your working clearly.

A, B & C were partners.  Their capitals were Rs. 30,000; Rs. 20,000 and Rs, 10,000 respectively.  According to the partnership deed they were entitled to an interest on capital at 54% p.a. in addition B was also entitled to draw a salary of Rs. 500 per month.  C was entitled to a commission of 5% on the profits after charging the interest on capital, but before charging the salary payable to B. The net profits for the year were Rs. 30,000 distributed in the ratio of their capitals without providing for any of the above adjustments.  The profits were to be shared in the ratio of 2 : 2 : 1.  Pass the necessary adjustment entry showing the workings clearly.

P, Q and R are partners sharing profits in the ratio of 3 : 2 : 1.  However, R is guaranteed Rs. 20,000 as his share of profits every year.  Deficiency if any would be borne by the other partners.  The profits for the two years ending 31.03.2008 and 31.03.2009 had been Rs. 75,000 and Rs 80,000 respectively.  Show the Profit and Loss Appropriation Account for the two years.

Pappu and Munna are partners in a  firm sharing profits in the ratio of 3 : 2.  The partnership deed provided that Pappu was to be paid salary of Rs. 2,500 per month and Munna was to get a commission of Rs. 10,000 per annum.  Interest on capital was to be allowed @ 5% per annum and interest on drawings was to charged @ 6% per annum.  Interest on Pappu's drawings was Rs. 1,250 and on Munna's drawings Rs. 425.  Capital of the partners were Rs. 2,00,000 and Rs. 1,50,000 respectively, and were fixed.  The firm earned a profit of Rs. 90,575 for the year ended on 31.3.2004.  Prepare Profit and Loss Appropriation Account of the firm.

A and B start business on July 1, 2004, each partner contributing Rs. 1,50,000 as his share of capital.  Three months later, on October 1, 2004, B makes an additional contribution of Rs. 1,00,000 which is treated as a loan.  The profit for the period ending March 2005 was Rs. 85,000 before charging any interest or salary.  All the partners were entitled to a salary of Rs. 3,000 each, per quarter.  The partners had drawn Rs. 24,000 each on 1st January 2005.  Prepare the Profit and Loss Appropriation Account for the period ended March 31,2005.

Ram and Shyam were partners in a firm sharing profits in the ratio of 3 : 5.  Their fixed capitals were : Ram Rs. 5,00,000 and Shyam Rs. 9,00,000.  After the accounts of the year had been closed, it was found that interest on capital at 10% per annum as provided in the partnership agreement has not been credited to the Capital to the Capital Accounts of the partners.  Pass a necessary entry to rectify the error.

Shiv and Shaker were partners in a firm sharing adjusting entry for the same.  Rs. 2,10,000 respectively.  The partnership deed provided for the following :
(i) Interest on capital @ 12% p.a.
(ii) Interest on drawings @ 18% p.a.
Shiv withdrew Rs. 12,000 on 30.6.2006 and Shanker withdrew Rs. 18,000 on 30.9.2006.  The profit of the firm for the year ended 31.3.2007 was Rs. 97,000, which was distributed among the partners without providing for the above adjustments.  Pass adjustment entry.

On March 31,2005 after the close of books of accounts, the capital accounts of A, B and C stored at Rs. 24,000; Rs. 20,000 and Rs. 12,000 respectively.  The profits for the year Rs. 36,000 was distributed equally.  Subsequently it was discovered that interest on capital @ 5% p.a. had been omitted.  The profit sharing ratio was 2 : 2 : 1.  Pass an adjustment journal entry.

State the followed to maintain capital accounts, if interest on capital, salary to the partner and share of profit are credited while interest on drawings and share of loss are debited to the partner's capital method.

X, Y and Z were partners in a firm sharing profits in the ratio of 7 : 4 : 9.Their fixed capitals were Rs.2,00,000, Rs.75,000 and Rs.3,50,000 respectively.Their partnership deed provided for the following
(i) Interest on capital @ 9% per annum.
(ii) Salary of Rs.6,000 per monthly to Y.
(iii) Interest on Drawings @^% per annum.
During the year ended 31st december, 2015, the firm earned a profit of rs.1,70,000.Interest on X's drawings was Rs.750, on Y's drawings Rs.1,250.Prepare profit and Loss appropriation account for the year ended 31st december 2015.

V and B two friends, belonging to Hindhu and Sikh religions respectively, were partners in a firm sharing profits in 3 : 2 ratio.their respective capitals were Rs.10,00,000 and rs.15,0.0,000.The partnership deed provided the following.
(i) Interest on capital@10% per annum.
(ii) Interest on drawings @ 12% per annum.
During the year ended 31st March, 2015, V's drawings were Rs.1,000 per month drawn at the end of every month and B's drawings Rs.2,000 per month drawn in the beginning of the every month.After the preparation of final accounts for the year ended 31st march, 2015it was discovered that interest on V's drawings was not taken into consideration.
Calculate Interest on V's drawings and pass necessary adjusting entry for the same.Also identify the values involved.