ISC ACCOUNTS 12 Guarantee of Profit to a partner MCQs with solved answers

ISC ACCOUNTS 12 Guarantee of Profit to a partner MCQs with solved answers

Guarantee of Profit

Guarantee of profit means a minimum amount of profit to be paid to a partner.

This amount shall be given to him if his share of profit is lower than the guaranteed amount.

The deficit shall be borne either by one of the old partners or by all the old partners in a particular agreed ratio.

If there is no agreement, then in their old profit sharing ratio, if his actual share of profit is more than the guaranteed amount, then, he will be given his actual share of profit.

He gets the guaranteed amount or the actual share of profit, whichever is higher.

Process Of Solution

1. Distribute profit among all the partners in the profit-sharing ratio.

2. Work out the amount of deficiency by comparing it with the guaranteed amount and his actual share of profit.

3. The other partners will bear the deficiency in an agreed new ratio.

ISC ACCOUNTS 12 Guarantee of Profit to a partner MCQs with solved answers

Question 1.

 R, S, and M are partners in a firm. Their profit sharing ratio is 5 : 3 : 2. However, M is guaranteed a minimum amount of ₹ 45,000 as share of profit every year. Any deficiency arising on that amount shall be met by S. The profits for the years ended 31st March 2020 ₹2,00,000. 

(i) ‘S’ share of profit will be:

(a) ₹60,000
(b) ₹55,000
(c) ₹45,000
(d) ₹50,000

(ii) ‘R’ share of profit will be:

(a) ₹1,00,000
(b) ₹95,000
(c) ₹1,05,000
(d) None of these

(iii) ‘M’ share of profit will be:

(a) ₹40,000
(b) ₹45,000
(c) ₹60,000
(d) None of these

(iv) ‘R, S, and M Share of profit will be:

(a) ₹1,00,000, ₹60,000,₹40,000
(b) ₹1,00,000, ₹55,000,₹45,000
(c) ₹1,00,000, ₹50,000,₹50,000
(d) ₹1,00,000, ₹55,000,₹40,000

Answer – Question Number 1

(i). Answer- (b) ₹55,000

(ii). Answer (a) ₹1,00,000

(iii). Answer(b) ₹45,000

(iv) . Answer ₹1,00,000, ₹55,000,₹45,000

Solution:

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ISC ACCOUNTS 12 Guarantee of Profit to a partner MCQs with solved answers

Question 2.

 Ram, Shyam, and Mohan are partners in a firm. Their profit sharing ratio is 5 : 3 : 2. However, Mohan is guaranteed a minimum amount of ₹ 60,000 as share of profit every year. Any deficiency arising on that amount shall be met by Ram and Shyam equally. The profits for the years ended 31st March 2020 ₹ 2,50,000. 

(i) ‘Shyam’ share of profit will be:

(a) ₹60,000
(b) ₹70,000
(c) ₹45,000
(d) ₹50,000

(ii) ‘Ram’ share of profit will be:

(a) ₹1,20,000
(b) ₹95,000
(c) ₹1,05,000
(d) None of these

(iii) ‘Mohan’ share of profit will be:

(a) ₹40,000
(b) ₹45,000
(c) ₹60,000
(d) None of these

(iv) ‘Ram, Shyam, and Mohan Share of profit will be:

(a) ₹1,20,000, ₹70,000,₹60,000
(b) ₹1,25,000, ₹75,000,₹50,000
(c) ₹1,00,000, ₹50,000,₹50,000
(d) None of these

Answer – Question Number 2

(i). Answer- (b) ₹70,000

(ii). Answer (a) ₹1,20,000

(iii). Answer (c) ₹60,000

(iv). Answer (a) ₹1,20,000, ₹70,000,₹60,000

Solution:

ISC ACCOUNTS 12 Guarantee of Profit to a partner MCQs with solved answers

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Question 3.

Jay and Vijay were in partnership sharing profits and losses in the ratio of 3: 2. In appreciation of the services of Sanjay, their manager who was in receipt of a salary of ₹24,000 and a commission of 5% of net profit after charging salary and commission.
They took him into partnership from 1st April 2010 giving him 1/8th share of profits.
The agreement provided that any excess over his former remuneration to which Sanjay becomes entitled will be borne by Jay and Vijay in the ratio of 2 : 3.
The profits for the year ended 31st March 2021 amounted to ₹ 4,44,000.

(i) ‘Jay’ share of profit will be:

(a) ₹60,000
(b) ₹70,000
(c) ₹2,35,400
(d) ₹50,000

(ii) ‘Vijay’ share of profit will be:

(a) ₹55,500
(b) ₹1,53,100
(c) ₹2,35,400
(d) None of these

(iii) ‘Sanjay’ share of profit will be:

(a) ₹55,500
(b) ₹45,000
(c) ₹60,000
(d) None of these

(iv) Deficiency chargeable to Jay and Vijay in the ratio of 3:2 will be:

(a) ₹11,500
(b) ₹55,500
(c) ₹44,000
(d) None of these

(v) ‘Sanjay’ Commission will be:

(a) ₹20,000
(b) ₹24,000
(c) ₹22,200
(d) None of these

Answer – Question Number 3

(i). Answer- (c) ₹2,35,400

(ii). Answer (b) ₹1,53,100

(iii). Answer (a) ₹55,500

(iv). Answer (a) ₹11,500

(v). Answer(a) ₹20,000

Solution:

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ISC ACCOUNTS 12 Guarantee of Profit to a partner MCQs with solved answers

Question 4.

P, Q, and R are partners in a firm sharing profits and losses in the ratio of 5:4:1. Q guaranteed a minimum profit of ₹ 16,000 to R. The trading profit of the firm for the year ending 31st March 2021, was ₹ 1,30,000.

(i) ‘P’s share in the profits of the firm will be:
(a) ₹ 65,000
(b) ₹ 60,000
(c) ₹ 69,600
(d) ₹ 66,000

(ii) ‘Q’s share in the profits of the firm will be:
(a) ₹ 65,000
(b) ₹ 52,000
(c) ₹ 49,000
(d) ₹ 16,000

(iii) ‘R’s share in the profits of the firm will be:
(a) ₹ 72,000
(b) ₹ 16,000
(c) ₹ 69,600
(d) ₹ 13,000

(iv) Deficiency will be:

(a) ₹3,000
(b) ₹3,300
(c) ₹4,300
(d) None of these

Answer – Question Number 4

(i). Answer- (a) ₹ 65,000

(ii). Answer (c) ₹ 49,000

(iii). Answer (b) ₹ 16,000

(iv). Answer (a) ₹3,000

 

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ISC ACCOUNTS 12 Guarantee of Profit to a partner MCQs with solved answers

Question 5.

P, Q, and R are partners in a firm sharing profits and losses in the ratio of 5:4:1. Q guaranteed a minimum profit of ₹ 16,000 to R. The trading profit of the firm for the year ending 31st March 2021, was ₹ 1,80,000.

(i) ‘P’s share in the profits of the firm will be:
(a) ₹ 90,000
(b) ₹ 85,000
(c) ₹ 70,000
(d) ₹ 60,000

(ii) ‘Q’s share in the profits of the firm will be:
(a) ₹ 90,000
(b) ₹ 72,000
(c) ₹ 49,000
(d) ₹ 16,000

(iii) ‘R’s share in the profits of the firm will be:
(a) ₹ 72,000
(b) ₹ 18,000
(c) ₹ 69,600
(d) ₹ 16,000

(iv) Deficiency will be:

(a) ₹3,000
(b) ₹3,300
(c) ₹4,300
(d) Zero

Answer – Question Number 5

(i). Answer- (a) ₹ 90,000

(ii). Answer (b) ₹ 72,000

(iii). Answer (b) ₹ 18,000

(iv). Answer (d) Zero

Question 6.

P, D, and K are partners sharing profits in the ratio of 5:4:1.  K is given a guarantee that his share of profits in any given year would not be less than ₹ 50,000. Deficiency, if any would be borne by P and D equally. Profits for the year amounted to ₹ 4,00,000.

(i) ‘K’s share in the profits of the firm will be:
(a) ₹ 40,000
(b) ₹ 50,000
(c) ₹60,000
(d) None of these

(ii)  Deficiency will be:
(a) ₹ 10,000
(b) ₹ 20,000
(c) ₹ 30,000
(d) ₹ 40,000

Answer – Question Number 6

(i). Answer- (b) ₹ 50,000

(ii). Answer (a) ₹ 10,000