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Assertion: Batman… (Class 12 Accountancy SQP 2023-24, Q2)

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AccountancyCBSE Class 12 · Sample paper, session 2023-24 · 1 mark · Assertion-reason

CBSE Class 12 Accountancy sample paper 2023-24: question 2

From the official CBSE sample question paper for 2023-24, section A, question 2, for 1 mark. Try it first; the hints and our step-by-step solution are below.

Q2 · 1 mark · Assertion-reasonCompetency-basedAccounting for Partnership: Basic Concepts

Assertion: Batman, a partner in a firm with four partners has advanced a loan of ₹50,000 to the firm for last six months of the financial year without any agreement. He claims an interest on loan of ₹3,000 despite the firm being in loss for the year.

Reasoning: In the absence of any agreement / provision in the partnership deed, provisions of Indian Partnership Act, 1932 would apply.

  1. (A)Both A and R are correct, and R is the correct explanation of A.
  2. (B)Both A and R are correct, but R is not the correct explanation of A.
  3. (C)A is correct but R is incorrect.
  4. (D)A is incorrect but R is correct.

Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2023-24.

Hints

Open one hint at a time and try again before the next.

Hint 1

Which rate of interest does the Partnership Act allow on a partner's loan?

Hint 2

The loan was given only for the last six months.

Hint 3

Is interest on a partner's loan a charge or an appropriation?

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. With no agreement, Section 13(d) of the Indian Partnership Act allows interest on a partner's loan at 6% p.a., and it is a charge, payable even in a year of loss. For 6 months: ₹ 50,000 × 6% × 6/12 = ₹ 1,500, not ₹ 3,000.

  2. So Batman's claim of ₹ 3,000 (the Assertion) is wrong, while the Reason (the Act applies when the deed is silent) is true. Option (D).

    1 mark

Answer: (D) A is incorrect but R is correct.

Where the marks are

  • Interest on loan at 6% p.a. for 6 months is ₹ 1,500, so A is false and R is true (1 mark)

Revise the chapter

Practise this chapterBoard-style questions from Accounting for Partnership: Basic Concepts, one at a time, marked against the answer key and marking points.Back to the full paperSample paper 2023-24: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.