1.Anurag and Mohit were partners sharing profits in the ratio of 3:2.

Their capitals as
on 1st April, 2023 were Rs. 5,00,000 and Rs. 4,00,000 respectively. The Partnership
Deed allowed interest on capital @ 8% p.a. Calculate IOC of Anurah and Mohit at the
end of the year i.e 31st March 2024.

2. Land and Sky were partners sharing profits in the ratio of 1:2. Their capitals as on
1st April, 2023 were Rs. 1,00,000 and Rs. 4,00,000 respectively. The Partnership Deed
allowed interest on capital @ 6% p.a. Calculate IOC of Land and Sky at the end of the
year i.e 31st March 2024.

3. Kashish, Amit and Kushal started a firm on 1st October, 2024 sharing
profits and losses in the ratio of 3:2:1. They introduced capitals in their
profit-sharing ratio. Kashish had invested capital of ₹6,00,000. The
Partnership Deed allowed interest on capital @ 5% p.a.Calculate Interest on
Capital of Kashish, Amit and Kushal for the year ended 31st March, 2024.

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11 a..Ram and Laxman started business on 1st April 2022 with capitals of
₹ 20,00,000 and ₹ 12,00,000 respectively. On 1st May, Ram introduced
additional capital of ₹ 4,00,000 and Laxman withdrew ₹ 2,00,000 from his
capital. On 1st October, Ram withdrew ₹ 8,00,000 from his capital and
Laxman introduced ₹ 10,00,000. Interest on capital is allowed @ 6% p.a.
Calculate the interest on capital for the year ending 31st March 2023 .
11.b. Girish and Satish are partners in a firm. Their Capitals on April 1, 2018 were
Rs.5,60,000 and Rs.4,75,000 respectively. On August 1, 2018 they decided that their Capitals
should be Rs. 5,00,000 each. The necessary adjustment in the Capitals were made by
introducing or withdrawing cash. Interest on Capital is allowed at 6% p.a. You are required
to compute interest on Capital for the year ending March 31, 2019.

11c. X, Y and Z are partners in a firm. Their Capitals as on April 1, 2016 were
Rs.5,00,000; Rs.4,00,000 and Rs.3,00,000 respectively. On July 1, 2016 they introduced further
Capitals of Rs.1,00,000; Rs.80,000 and Rs.50,000 respectively. On February 1, 2017 Y
withdrew Rs.15,000 from his Capital. Interest is to be allowed @ 8% p.a. on the Capitals.
Compute interest on Capitals for the year ending March 31, 2017.

11.d. On March 31, 2016 after the close of accounts, the capitals of Mountain, Hill and
Rock stood in the books of the firm at Rs.4,00,000; Rs.3,00,000 and Rs.2,00,000 respectively.
Subsequently, it was discovered that the interest on capital @ 10% p.a. had been omitted.
The profit for the year amounted to Rs.1,50,000 and the partner’s drawings had been
Mountain : Rs.20,000; Hill Rs.15,000 and Rock Rs.10,000.
Calculate interest on capital.

12.a Anubha and Kajal entered into partnership sharing profits and losses in the
ratio of 2 : 1. Their capitals were Rs.90,000 and Rs.60,000. The profit during the year were
Rs.45,000. According to partnership deed, both partners are allowed salary, Rs.700 per month
to Anubha and Rs.500 per month to Kajal. Interest is allowed on capital @ 5% p.a. The
drawings at the end of the period were Rs.8,500 for Anubha and Rs.6,500 for Kajal. Interest is
to be charged @ 5% p.a. on drawings. Prepare partners capital accounts, assuming that the
capital accounts are fluctuating

12. Ram and Mohan are partners and their capitals for the year ended 31st March
2023 were ₹ 2,40,000 and ₹ 1,80,000 respectively. During the year 2022-23, Ram’s
and Mohan’s drawings were ₹ 40,000 and ₹ 60,000 respectively. Profit (before
charging interest on capital) during the year was ₹ 1,60,000. Calculate interest on
capital @ 5% p.a. for the year e

nded 31st March, 2023.

13. Mona and Roma contribute as capital ₹ 2,00,000 and ₹ 1,00,000 respectively.
They decide to allow interest on capital @ 6% p.a. Their profit sharing ratio is 2 : 3 and
profit (before interest) for the year is ₹ 15,000. Show the distribution of profits.

(i) Where there is no agreement except for interest on capitals, and

(ii) (ii) Where an agreement exists that the interest on capital will be allowed
whether the firm earns a profit or incur a loss.

14. From the following Balance Sheet of Sujata and Swati, Calculate interest on capital
@ 5% p.a. for the year ended 31st March 2023:
 Balance Sheet as at 31st March, 2023
Liabilities ₹ Assets ₹

Sujata’s Capital 9,000

Swati’s Capital 8,000 Sundry Assets 21,000
Workmen Compensation Reserve 4,000

21,000 21,000

During the year, drawings of Sujata and Swati were ₹ 1,000 and ₹ 3,000 respectively.
Profit during the year was ₹ 6,000.

15. From the following Balance Sheet of Arun and Barun and Additional information,
Calculate interest on capital @ 6% p.a. payable to Barun for the year ended 31st
March 2023:

Liabilities ₹ Assets ₹

Arun’s Capital A/c 50,000

Barun’s Capital A/c 40,000 Sundry Assets 1,10,000
Profit & Loss A/c 20,000

1,10,000 1,10,000
During the year, Barun’s drawings were ₹ 15,000, and profit during the year was ₹
30,000.

16. Gee and Ess are partners having fixed capitals of ₹ 3,00,000 each. They have
opening credit balances of ₹ 1,00,000 and ₹ 2,00,000 respectively in the Current
Accounts. Partnership Deed allows interest on capital and also allows and charges
interest on Current Accounts @ 6% p.a. Calculate the interest that will be allowed by
the firm

17. Emm and Ell are partners having fixed capitals of ₹ 5,00,000 and ₹ 6,00,000
respectively. The opening balances in their current accounts were: Emm – ₹ 1,00,000
(Cr.) and Ell – ₹ 1,00,000 (Dr.). Partnership Deed allows interest on capital and also
allows and charges interest on Current Accounts @ 6% p.a.
Calculate the interest allowed or charged by the firm.

17b.. Ram and Mohan are partners in a business. Their capitals at the end of the year were Rs.24,000 and Rs.18,000
respectively.
During the year 2015-16, Ram’s drawings and Mohan’s drawings were Rs.4,000 and Rs.6,000 respectively. Profit (before
charging interest on capital) during the year was Rs.16,000. Calculate interest on capital @ 5% pa. for the year ended 31st
March, 2016.

18.

Calculate interest on Capital and on Current Accounts @ 5% p.a. from the following Balance Sheet as at
31st March 2023 of Anu and Bobby:
 Balance Sheet as at 31st March, 2023
Liabilities ₹ Assets ₹

Sundry Creditors
Expenses Payable 40,000
Cash in Hand 10,000
Capital A/cs: 10,000
Cash at Bank 90,000
Anu 2,00,000
Current A/c: Bobby 50,000
Bobby 2,50,000
Fixed Assets 3,90,000
Current A/c 40,000
Anu

5,40,000 5,40,000

Drawings during the year were ₹ 36000 each and the net profit share of each
partner was ₹ 30,000

19. Sumant and Rumant Contribute ₹ 8,00,000 and ₹ 4,00,000 respectively as capitals on
which they agree to allow interest @ 6% p.a. They are to share profits in the ratio of 3 : 2. Net
Profit for the year is ₹ 60,000. Show the relevant account to allocate interest on capital: (i) if
Partnership Deep is silent about the treatment of interest on capital, and (ii) if interest is a
charge as per Partnership Deed. Drawings during the year were ₹ 36,000 each and the net
profit share of each partner was ₹ 30,000.
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Question20
21. Bala and Rajan are partners sharing profits in the ratio of 3 : 2 with capitals of ₹
5,00,000 and ₹ 4,00,000 respectively. Pass the necessary Journal entry or entries and
show the distribution of profit or loss for the year ended 31sst March 2023 by
preparing relevant accounts in each of the following cases:

Case – 1: Partnership Deed is silent on interest on capital and profit for the year is ₹
50,000.

Case – 2: Partnership Deed allows interest on capital @ 10% p.a. and loss for the year
is ₹ 50,000.

Case – 3: Partnership Deed allows interest on capital @ 10% p.a. and profit for the
year is ₹ 1,00,000.

Case – 4: Partnership Deed allows interest on capital @ 5% p.a. as a charge against

profit and profit before interest for the year is ₹ 50,000.

Case – 5: Partnership Deed allows interest on capital @ 5% p.a. as a charge against

profit and profit before interest for the year is ₹ 30,000.

Case – 6: Partnership Deed allows interest on capital @ 5% p.a. as a charge and profit
for the year is ₹ 45,000

22. Raman and Pawan are partners sharing profits and losses in the ratio of 3 : 2.
Raman being a non-working partner contributes ₹ 50,00,000 as capital. Pawan being a
working partner agrees to work for the firm. The Partnership Deed provides for
interest on capital @ 8% and salary to every working partner @ ₹ 20,000 per month.
Net profit for the year ended 31st March, 2023, was ₹ 2,00,000. Show the distribution
of profit.