What are the rules in the absence of a partnership deed?

Share your love

Are you looking for the rules and provisions in the absence of partnership as given in class 12 Accountancy CBSE Board? I have summed up all rules if there is only verbal agreement among partners.

Provisions applicable in the absence of Partnership Deed

In the absence of a partnership Deed or if the partnership Deed is silent on a certain point. following Provisions of the Indian Partnership Act 1932 would apply.

1. Profit Sharing Ratio:- Profits and Losses are to be shared equally irrespective of their capital contribution.

2. Interest on Capital:- No interest on capital is allowed to the partners.

3. Interest on Drawings:- No Interest is to be charged on drawings.

4. Remuneration to a Partner:- No partner is entitled to any salary and commission for taking an active part in day-to-day business affairs.

5. Interest on Loan of Partner:- On any loan given by the partner to the firm. Interest @6% p.a. would be allowed even if there are losses to the firm.

6. Admission of a partner:- To admit a new partner all existing partners’ consent is mandatory.

7. Interest on Loan to Partner by Firm:- No Interest is charged on any loan given by the firm to the partner.

Important Provisions of the Indian Partnership Act, 1932

i)If all the partners agree, a minor may be admitted for the benefit of partnership.[Sec – 30]
2)A person may be admitted as a partner either with the consent of all the existing partners or in accordance with an agreement among the partners.[Sec – 31]
3)A partner may retire from the firm either with the consent of all the other partners or in accordance with an agreement among the partners[Sec – 32]
4)Unless otherwise agreed by the partners in the Partnership Deed, a firm is dissolved on the death of a partner.[Sec – 69]
5)Unless othewise agreed by the partners in the Partnership Deed, a firm is dissolved on the death of a partner.[Sec – 35]
S.NTopics
1.Definition of Partnership
2.Features of Partnership
3.What are the Rights of Partners
4.What is Partnership Deed, Meaning, content
5.What are the Rules in the absence of a Partnership Deed
6.What are the Rules in the absence of Partnership Deed
7.What are the Liabilities of Partners
8.Profit and Loss Appropriation Account format, features
9.Journal Entries of Profit and Loss Appropriation A/c
10.Difference between Profit and Loss A/c and Profit and Loss Appropriation A/c
S.NTopics
11.Difference between charge against profit and appropriation of Profit
12.Treatment of Interest on loan by the firm to the partner
13.Treatment of Interest on loan by the Partner to the firm
14.Treatment of Rent paid to partner in partnership firm
15. Accounting Treatment of Managers commission in partnership
16.Items not shown in Profit and Loss Appropriation A/c
17.Methods of Maintaining Partners Capital A/c
18.Accounting Treatment When Appropriation is more than the Available Profit
19.Difference Between Fixed Capital A/c and Fluctuating Capital A/c
20.Difference Between Capital and Current A/c
Share your love
Anurag Pathak
Anurag Pathak

Anurag Pathak is an academic teacher. He has been teaching Accountancy and Economics for CBSE students for the last 18 years. In his guidance, thousands of students have secured good marks in their board exams and legacy is still going on. You can subscribe his youtube channel and can download the Android & ios app for free lectures.

Articles: 6649

Leave a Reply

Your email address will not be published. Required fields are marked *

close

Ad Blocker Detected!

Our Website is made possible by displaying online advertisements to our visitors. Please consider supporting us and remove the AD - Blocker to read this article.

Refresh