Anuj and Varun are partners sharing profits equally, with capitals of Rs. 1,00,000 and Rs. 80,000 respectively. Interest on capital is agreed @ 6% p.a. Varun is to be allowed an annual salary of Rs. 10,000. Manager is to be allowed commission Rs. 5,000. Anuj has also given a Loan on April 01, 2024 of Rs. 50,000 to the firm without any agreement. During the year 2024-25, the profit earned was Rs. 42,500. State their share of profit after necessary appropriations.
Answer & explanation
Correct answer: option 1
The correct answer is Option (1) → Rs. 6,850 each
Two items here are charges against profit, deducted before anything is appropriated: the manager’s commission, and interest on Anuj’s loan. With no agreement on the loan, interest is allowed at 6% p.a. under the Partnership Act. Interest on capital and Varun’s salary are then appropriations out of what is left.
Profit = Rs. 42,500
Less manager’s commission = Rs. 5,000
Less interest on Anuj’s loan = Rs. 50,000 × 6% = Rs. 3,000
Profit available for appropriation = Rs. 34,500
Less interest on capital: Anuj Rs. 6,000 + Varun Rs. 4,800 = Rs. 10,800
Less Varun’s salary = Rs. 10,000
Divisible profit = Rs. 34,500 − Rs. 20,800 = Rs. 13,700
Share of each partner = Rs. 13,700 ÷ 2 = Rs. 6,850
Note: NTA picked this question from an NCERT (2026-27) illustration and changed the figures. Do not ignore NCERT while practising numericals.
NCERT (2026-27 edition):
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