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A, B and C are in… (Class 12 Accountancy SQP 2023-24, Q4b)

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

CBSE Class 12 Accountancy sample paper 2023-24: question 4(b)

From the official CBSE sample question paper for 2023-24, section A, question 4(b), for 1 mark. Try it first; the hints and our step-by-step solution are below.

Q4(b) · 1 mark · MCQCompetency-basedAccounting for Partnership: Basic Concepts

A, B and C are in partnership business. A used ₹2,00,000 belonging to the firm without the information to other partners and made a profit of ₹35,000 by using this amount. Which decision should be taken by the firm to rectify this situation?

  1. (A)A need to return only ₹2,00,000 to the firm.
  2. (B)A is required to return ₹35,000 to the firm.
  3. (C)A is required to pay back ₹35,000 only equally to B and C.
  4. (D)A need to return ₹2,35,000 to the firm.

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

Who owns profit earned with the firm's money?

Hint 2

Both the money and the profit must come back.

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. Under Section 16(a) of the Indian Partnership Act, a partner must account for any profit made from using the firm's property, and the property itself must be returned.

  2. A must return the ₹ 2,00,000 and hand over the ₹ 35,000 profit to the firm: ₹ 2,35,000 in all. Option (D).

    1 mark

Answer: (D) A need to return ₹2,35,000 to the firm.

Where the marks are

  • Personal profit from firm's money belongs to the firm (Section 16) (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.