PARTNERSHIP BASIC- P/L APPROPRIATION (Q.1)
Channel: vikash chakraborty
Date: 17/03/2017

Q.1. After doing their graduation Shabir suggested to his classmate David to form a partnership to sell low cost school uniforms to the students belonging to low income group who have been admitted to the private schools of the city as per the provisions of Right to Education Act 2009. David agreed to the proposal and request to admit his friend Charu, a visually handicapped unemployed person also to be a member of the proposed firm. All of them agreed to form a partnership firm but they were not having enough capital to invest. Shabir therefore persuaded a rich friend of his, Rafiq, who hailed from Assam to be a partner and contribute the required capital. All of them formed a partnership on the following terms:
(i) Shabir will contribute Rs.1,00,000; David Rs.50,000, Rafiq Rs.10,00,000 and Charu will be partner without capital.
(ii) profit will be shared equally.
(iii) Interest on capital will be allowed @ 5% p.a.
The profits of the firm for the year ended 31st March 2014 were Rs.1,50,000.
(a) Identify any four values which according to you motivated them to form the partnership firm.
(b) Prepare Profit and Loss Appropriation Account of the firm for the year ending 31st March 2014.
ANS.
 (a) Following are the values which motivated Shabir and David to form the partnership firm:
(i) Sensitivity towards students belonging to low income groups.
(ii) Supporting the implementation of “Right of Education Act, 2009”.
(iii) Sensitivity towards differently-able individuals.
(iv) Providing entrepreneurial opportunities to people from different areas of the country. 
(v) Secularism.
(vi)  Empowering women entrepreneurship.