When two or more individuals get together to form a business, it is called a partnership (the partners). It entails all of the partners signing an agreement (the partnership agreement) outlining the terms and circumstances of their business relationship, including ownership, profits and losses, and duties. Partnerships explain and define a business relationship and duty in a clear and concise manner.
Meaning of Partnership
A partnership is a legal agreement between two or more people to manage and operate a business and share profits. There are various different kinds of partnership agreements. In a partnership business, for example, all partners share equally in the liabilities and profits, although in other businesses, partners may have limited liability. A "silent partner" is not participating in day-to-day business operations.
Salient Features of Partnership
- A partnership is a legal agreement between two or more persons to manage a business and share profits and liabilities.
- A general partnership company's profits and liabilities are shared by all members.
- An expulsion provision should be included when establishing a partnership agreement, describing what circumstances constitute grounds for expelling a partner.
- Limited liability partnerships are common among professionals such as physicians and attorneys.
- When compared to a corporation, there may be tax advantages to forming a partnership
There are three basic types of partnerships in the restricted sense of a for-profit company conducted by two or more individuals: general partnership, limited liability partnership, and limited partnership.
In a general partnership, all participants are equally liable in terms of legal and financial obligations. Individuals are personally liable for the obligations incurred by the partnership. Profits are distributed equitably as well. A partnership agreement will almost probably spell out the mechanics of profit sharing.
Following are some of the multiple choice questions on the Partnership with answers that will help the students in developing their knowledge.
1. A and B invest in a business in the ratio 3 : 2. If 5% of the total profit goes to charity and A's share is Rs. 855, the total profit is :
2. A, B and C enter into a partnership and their shares are in the ratio 1/2 : 1/3 : 1/4. After 2 months, A withdraws half of his capital and after 10 months, a profit of Rs. 378 is divided among them. What is B's share ?
3. A, B, C rent a pasture. A puts 10 oxen for 7 months, B puts 12 oxen for 5 months and C puts 15 oxen for 3 months for grazing. If the rent of the pasture is Rs. 175, how much must C pay as his share of rent?
4. A, B, C started a business with their investments in the ratio 1:3 :5. After 4 months, A invested the same amount as before and B as well as C withdrew half of their investments. The ratio of their profits at the end of the year is :
5. A began a business with Rs. 85,000. He was joined afterwards by B with Ks. 42,500. For how much period does B join, if the profits at the end of the year are divided in the ratio of 3 : 1 ?
6. If 4 (A's capital) = 6 (B's capital) = 10 (C's capital), then out of a profit of Rs. 4650, C will receive ____
7. A and B are partners in a business. A contributes 1/4 of the capital for 15 months and B received 2/3 of the profit. For how long B's money was used ?
8. Aman started a business investing Rs. 70,000. Rakhi joined him after six months with an amount of Rs. 1,05,000 and Sagar joined them with Rs. 1.4 lakhs after another six months. The amount of profit earned should be distributed in what ratio among Aman, Rakhi and Sagar respectively, 3 years after Aman started the business ?
9. A, B and C enter into a partnership with a capital in which A's contribution is Rs. 10,000. If out of a total profit of Rs. 1000, A gets Rs. 500 and B gets Rs. 300, then C's capital is :
10. X and Y invested in a business. They earned some profit which they divided in the ratio of 2 : 3. If X invested Rs. 40,000, the amount invested by Y is :
11. A and B started a business jointly A's investment was thrice the investment of B and the period of his investment was two times the period of investment of B. If B received Rs. 4000 as profit, then their total profit is :
12. A and B began business with Rs.3000 and Rs.4000 after 8 months, A withdraws Rs.1000 and B advances Rs.1000 more. At the end of the year, their profits amounted to Rs.630 find the share of A ?
13. Reena and Shaloo are partners in a business, Reena invests Rs, 35,000 for 8 months and Shaloo invests Rs. 42,000 for 10 months, out of a profit of Rs. 31,570, Reena's share is :
14. A and B start a business jointly. A invests Rs. 16,000 for 8 months and B remains in the business for 4 months, Out of total profit, B claims - of the profit. How much money was contributed by B ?
15. A, B, C hired a car for Rs. 520 and used it for 7, 8 and 11 hours respectively. Hire charges paid by B were :
16. A and B start a business, with A investing the total capital of Rs.50000, on the condition that B pays A interest @ 10% per annum on his half of the capital. A is a working partner and receives Rs.1500 per month from the total profit and any profit remaining is equally shared by both of them. At the end of the year, it was found that the income of A is twice that of B. Find the total profit for the year?
17. A, B, C subscribe Rs. 50,000 for a business, A Subscribes Rs. 4000 more than B and B Rs. 5000 more thanC. Out of a total profit of Rs. 35,000, A receives :
18. Simran started a software business by investing Rs. 50,000. After six months, Nanda joined her with a capital of Rs. 80,000. After 3 years, they earned a profit of Rs. 24,500. What was Simran's share in the profit ?
19. A, B and C enter into a partnership. They invest Rs. 40,000, Rs. 80,000 and Rs. 1,20,000 respectively. At the end of the first year, B withdraws Rs. 40,000, while at the end of the second year, C withdraws Rs. 80,000. In what ratio will the profit be shared at the end of 3 years ?
20. Sekar started a business investing Rs.25,000 in 1999. In 2000, he invested an additional amount of Rs. 10,000 and Rajeev joined him with an amount of Rs. 35,000. In 2001, Sekar invested another additional amount of Rs.10,000 and Jatin joined them with an amount of Rs.35,000. What will be Rajeev's share in the profit of Rs.1,50,000 earned at the end of 3 years from the start of the business in 1999?
21. A starts business with Rs. 3500 and after 5 months, B joins with A as his partner. After a year, the profit is divided in the ratio 2 : 3. What is B's contribution in the capital?
22. P and Q started a business investing Rs, 85,000 and Rs. 15,000 respectively. In what ratio the profit named after 2 years bo divided between P and Q respectively ?
23. Anand and Deepak started a business investing Rs. 22,500 and Rs. 35,000 respectively. Out of a total profit of Rs. 13,800, Deepak's share is :
24. Three partners shared the profit in a business in the ratio 4:6:8. They had partnered for 12 months, 8 months and 6 months respectively. What was the ratio of their investments?
25. Three friends, P, Q and R started a partnership business investing money in the ratio of 5 : 4 : 2 respectively for a period of 3 years. What is the amount received by P as his share in the total profit ? a. Total amount invested in the business in Rs. 22,000. b. Profit earned at the end of 3 years is 3/8 of the total investment. c. The average amount of profit earned per year is Rs. 2750.
26. A,B and C enter into a partnership in the ratio 72:43:65. After 4 months, A increases his share by 50%. If the total profit at the end of one year be Rs. 21600, then B's share in the profit is :
27. Karan started a business investing Rs 29000. After five months, Satish joined with a capital of Rs 18000. If at the end of the year, they earn a profit of Rs. 16970, then what will be the share of Satish in the profit ?
28. In a business, A and C invested amounts in the ratio 2:1, whereas the ratio between amounts invested by A and B was 3:2. If Rs. 1,57,300 was their profit, how much amount did B receive ?
29. Madhu started a business and he invested in 76000, After some month, Amar came to join with him and invest 57000.The end of the year the total profit was divided among them into ratio form 2 : 1.Find after how many months Amar join.
30. A and B entered into a partnership investing Rs. 13,000 and Rs. 12,000 respectively.After 3 months, A withdrew Rs. 5000 while B invested Rs. 5000 more, After 3 more months, C joins the business with a capital of Rs. 21,000, The share of B exceeds that of C, out of a total profit of Rs. 26,400 after one year by
31. Ram and Raj start a business with investments of Rs. 2500 and Rs. 2250 respectively. After 2 months, Ram takes out Rs.1250 from his capital. After 1 more month, Raj takes out Rs.750 of his capital while Rakesh joins them with a capital of Rs. 3500. At the end of 6 months, they earn a profit of Rs. 2540. Which of the following is the share of each member in the profit ?
32. A and B invests Rs.10000 each, A investing for 8 months and B investing for all the 12 months in the year. If the total profit at the end of the year is Rs.25000, find their shares?
33. A sum of Rs. 427 is to be divided among A, B and C in such a way that 3 times A’s share, 4 times B’s share and 7 times C’s share are all equal. The share of C is ?
34. A, B, C and D enter into partnership. A subscribes 1/3 of the capital B 1/4, C 1/5 and D the rest. How much share did A get in a profit of Rs.2490 ?
35. Three friends had dinner at a restaurant. When the bill was received, Akshitha paid 2/3 as much as Veena paid and Veena paid 1/2 as much as Lasya paid. What fraction of the bill did Veena pay ?
36. Vishal invested 10% more than Trishul. Trishul invested 10% less than Raghu. If the total sum of their investments is Rs. 5780, how much amount did Raghu invest ?
37. The ratio of investments of two partners A and B is 7:5 and the ratio of their profits is 7:10. If A invested the money for 5 months, find for how much time did B invest the money ?
38. Three milkmen rented a pasture. A grazed 24 cows for 4 months; B 10 cows for 6 months; C 56 cows for 5 months. If A's share of rent is Rs. 960, find the total rent of the field?
39. Deepa started a business in 2009 by investing Rs.50,000. She invested Rs. 20,000 as additional amount in 2010 and her friend Sushma joined her with an amount of Rs.70,000. Deepa invested another Rs. 20,000 in 2011 and Avanthi joined them with Rs. 70,000. At the end of these 3 years, they earned a profit of Rs. 3,00,000. Find Sushma's share ?
40. Rajeev start a business with Rs. 10000, Deepu joins him after 2 month with 20% more investment than Rajeev, after 2 month Shakti joins him with 40% less than Deepu. If the profit earned by them at the end of the year is equal to the twice of the difference between investment of Rajeev and ten times the investment of Shakti. Find the profit of Rajeev ?
41. Divide Rs.118000 among three persons A, B and C such that the ratio of the shares of A and B is 3:4 and that of B:C is 5:6 ?
42. Arun and Varun started business in partnership investing Rs. 20,000 and Rs. 15,000 respectively. After six months, Akhil joined them with Rs. 20,000. What will be Varun's share in the total profit of Rs. 25,000 earned at the end of 2 years from the starting of the business ?
43. A, B and C started a business where their initial capital was in the ratio of 2:3:4. At the end of 6 months, A invested an amount such that his total capital became equal to C's initial capital investment. If the annual profit of B is Rs. 3000 then what is the total profit ?
44. Rs. 700 is divided among A, B, C so that A receives half as much as B and B half as much as C. Then C's share is
45. Arun, Bharat and Chari started a business in a partnership with investment of Rs 12000, Rs 26000 and Rs 32000 respectively. After 4 months Arun leaves. After 6 months Bharat leaves and Arun joins with an amount equal to his earlier investment. After 10 months, Chari leaves and Bharat joins with his prior investment. At the end of the year they earn a profit of Rs 53622. Find the share of chari in the annual profit?
46. A certain amount is divided among P, Q and R in the ratio of 3 : 7 : 6 respectively. If the difference between share of P and Q is Rs. 2700, what is R's share?
47. R enter into a partnership in the ratio 2 : 3 : 5 . After 2 months, P increases his share 20% and Q by 10%. If the total profit at the end of one year is Rs 1,90,500, what amount will 'R' receive at the end of year as share in profit ?
48. Rushi and Arun are two business partners. They invest their capital in the ratio 7 : 9. After 6 months, a third person Ram joins them with a capital of two third of that of Arun. After a year, profit share of Rushi was Rs. 5600, then find total profit?
49. A and B started a business investing the money in ratio 4:6, after 6 months B withdraw his investment and C joins him with twice the amount of B. At the end of the year total profit is Rs.3315. Find share of C ?
50. K, l, m together started a business. k invested Rs.6000 for 5 months l invested Rs.3600 for 6 months and m Rs.7500 for 3 months. If they get a total profit of Rs.7410. Find the share of l ?
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