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1. Introduced extra capital by partner.

2. Withdrawn of capital by partner.

• Interest on drawings
• Partner’s share in net loss.

• Additional capital brought by partner’s
• Interest on capital
• Salary and commission payable to partners
• Partner’s share in net profit.

• Withdrawn of capital by partner.
• Drawing
• Interest on drawing
• Share of loss

(a) Trade is an economic activity,
(b) Exchange is the base of trade.

• Interest on capital
• Salary of partner

Three;
(a) Trade,
(b) Commerce and
(c) Industry

In which account net profits and losses show distribution amount to partners called profit and loss appropriation account. It is a nominal nature account.

A mother nursing her child, volunteers working for betterment of community,citizens helping victims of earth-quake, etc.

It is derived from the word ‘busy’; Busy means to continuously remain active.

There are two types of trade. They are:
(A) Internal trade,
(B) International trade

(A) Internal trade:

The trade that takes place among different regions but within the boundaries of a country is called internal trade.
Example:

• A trader of Gujarat buying woollen sweaters from Punjab.
• A kite maker of Surat selling his kites to a trader in Baroda.

From the perspective of distribution, internal trade can be divided into.

1. Wholesale trade and
2. Retail trade.

1. Wholesale trade:

• In wholesale trade a wholesaler purchases the goods in wholesale i.e. a very large quantity from the producer and sells it to various retailers as per their requirement.
• For example, a wholesaler may buy 500 electric fans from a manufacturing company and sell it to various retailers in quantities like 5, 7, 10, 50, etc. as per retailer’s need.
• Wholesaler serves as a link between producer and retailer.

2. Retail trade:

In retail trade, retailer purchases goods from wholeseller and sells the goods to the customers as per their need.

(B) International trade:

• Trade carried out for exchanging the goods or services between two countries is called international trade. Thus, international trade crosses boundaries of the country.
• For example, a Japanese company selling its televisions to India. An Indian trader selling its Kesar mango to an African trader.
• International trade consists of:
  (a) Import trade,
  (b) Export trade and
  (c) Re-export trade.

P & L Adjustment A/c Dr. 2,000 

To Shipra’s Capital A/c 2000 

(Salary not given to Shipra now rectified.)

Partners are the persons who have agreed to carry on a business and share its profits and losses, partners carrying on the business are collectively known as partnership firm.

Three; Business, profession and employment.

When new products are developed that are better than existing or are cheaper and attractive for the customers than such substitutes threatens the existing products. For example when desi ghee seemed costlier, many people switched over to its substitute dalda ghee which is much cheaper.

A’s Capital A/c Dr. 6,000 

To B’s Capital A/c 3,000 

To C’s Capital A/c 3,000 

(To profit wrongly distributed now rectified.)

Due to uncertain demand a businessman may not be able to decide how much raw material he should buy, how much should he produce, how much stock he should maintain, etc. Under such situations he may incur loss due to unsold products.

In a firm minimum number of partner’s can be 02 and maximum number of partner’s can be 50.

(a) A professional charges fee,
(b) The primary objective is to render service,
(c) It is compulsory to follow the code of conduct.

Three;

(a) Primary,
(b) Secondary and
(c) Tertiary.

Correct option is (D) Both (B) and (C)

(d) All of the above

Internal trade:

The trade that takes place among different regions but within the boundaries of a country is called internal trade.
Example:

• A trader of Gujarat buying woollen sweaters from Punjab.
• A kite maker of Surat selling his kites to a trader in Baroda.

From the perspective of distribution, internal trade can be divided into.

1. Wholesale trade and
2. Retail trade.

1. Wholesale trade:

• In wholesale trade a wholesaler purchases the goods in wholesale i.e. a very large quantity from the producer and sells it to various retailers as per their requirement.
• For example, a wholesaler may buy 500 electric fans from a manufacturing company and sell it to various retailers in quantities like 5, 7, 10, 50, etc. as per retailer’s need.
• Wholesaler serves as a link between producer and retailer.

2. Retail trade:

In retail trade, retailer purchases goods from wholeseller and sells the goods to the customers as per their need.

Correct answer is (d) 50

(b) interest on drawings

Profession:

• A person possessing specialized skills, knowledge, training and specific professional qualification is capable of providing certain specific services to the society. Such a person is called a professional and the work he does is called his profession.
• For example, doctors, lawyers, charted accountants are all called professionals.
• Over and above acquiring skills and education, a professional also needs to get himself registered with the body governing that profession. For example, a charted accountant (CA), needs to take membership of the Institute of Chartered Accountants of India (ICAI), get registered and he then work as per the code of conduct established by such bodies.
• A professional provides professional services to its clients and in return receives fees as his profit.
  A person can also obtain professional qualification and work as an employee and earn salary rather than fees. For example, a doctor may join a hospital, a lawyer may join a law firm, etc.

Characteristics of profession are as follows:

• A professional needs to obtain specialized knowledge, skills and professional education. For example, a doctor needs to medically learn how to treat a patient.
• A professional working independently charges fees for services he provides to his clients. The amount of fees depends on type of profession, types of skill, knowledge and experience.
• The primary objective of a professional is to provide services.
• Profession can be called as an independent economic activity.
• A professional does not produce tangible products but provides services. For example, a lawyer fighting a case for his client (customer) is providing this service to his client. In this regard, a customer pays for fighting a case, getting cured of a disease, getting income tax returned filed, etc.
• A professional has to abide by the code of conduct established by the professional association where he is registered.
• Just like business, monetary return is uncertain in profession because it depends on the number of customer that goes to a professional to take his service.

Interest on drawings is income of firm.

Production, economic activity, changing the form of raw material, producing various articles, adding utility, etc. are all characteristics of an industry.

When a professional takes up a job under someone rather than practicing independently. For example, when a doctor works in a hospital for someone.

Meaning:

• An economic activity done under an individual or an organization in return for a fixed salary or wage is called an employment. In employment, the work is assigned as per the contract signed.
• For example a teacher working in a school, a mechanic working in someone’s garage, an engineer working in a factory, etc.
• The person or organization that gives job or say employment is called employer and the person who does the job is called employer. Thus, teacher is an employee and school is employer. The school has given employment (job) to the teacher to teach in the school.

Characteristics:

• The employer gets a fix salary at fixed intervals in return of physical or mental labour he provides. For example, a brick layer gets a salary at the end of month to lay the bricks. This is an example physical labour. A teacher teaching the students in a school is providing mental labour and is paid salary every month.
• In employment, the employee may get certain additional benefits such as medical allowances, conveyance, bonus, pension, etc.
• In employment, the employer performs the work assigned by his/her employer as per the contract signed between the two.
• The employer pre-determines the qualification needed for the job, skills, working hour, retirement benefits, etc. for the employee.
• Employment is a dependent activity i.e. employee is dependent on employer for his earnings.
• Both employer and employee are bound to follow rules as per the contract.
• Unlike business, the employee need not make any capital investment.

(a) Commerce is an economic activity,
(b) It includes auxiliary services such as transport, warehousing, communication, etc.

International trade:

• Trade carried out for exchanging the goods or services between two countries is called international trade. Thus, international trade crosses boundaries of the country.
• For example, a Japanese company selling its televisions to India. An Indian trader selling its Kesar mango to an African trader.
• International trade consists of
  (a) Import trade,
  (b) Export trade and
  (c) Re-export trade.

Correct option is (C) Traded

Two;

1. Retail trade and
2. wholesale trade.

Correct answer is (b) written

(d) provided share in profits

Correct answer is (b) equally

Correct answer is (a) 6% p.a.

Interest will calculate as follows:

1. 1st day of every month: \( \frac { N+1 }{ 2 } = \frac { 6+1 }{ 2 } \) = 3.5 month

2. Last day of every month: \( \frac { N-1 }{ 2 } = \frac { 6-1 }{ 2 } \)=  2.5 month

3. Middle day of every month: \( \frac { N }{ 2 } = \frac { 6 }{ 2 } =\)  3 month

(a) Employee gets fixed salary at a fix interval,
(b) He may get other allowances such as conveyance, medical, etc.

With respect to commerce activities can be divided in two parts. They are:
(I) Economic activity,
(II) Non-economic activity

(I) Economic activity:
When a person does an activity with the aim of earning money or some economic benefit the activity is called economic activity.

Explanation:
Man needs money to satisfy his daily needs.
In order to get money he needs to perform certain activities that earn him money.
A man thus performs an act that can satisfy the needs of others and in return earns money or say economic benefit.

Example:

• A farmer gets economic benefit by producing food grains, a weaver by weaving cloth, a blacksmith by producing iron articles.
• All these people are satisfying the needs of our society and in turn are earning money or say gaining economic benefits.
• Similarly, doctors, lawyers, engineers, etc. also fulfill the needs of society and earn economic gains.
  Economic activity lies at the centre of modern world.

(II) Non-economic activity:

• When a person does an activity without the aim of earning money or gaining any economic benefit, the activity is called non-economic activity.
• The motivation behind these activities could be serving the country in needs, serving the society, compassion, love towards nature, etc.

Example:

• Social workers who conduct various activities for the betterment of society
• A mother performing nursing activity like taking care of her child when he is sick
• Volunteers working for maintaining unity in the community and society
• Volunteers extending their help to people affected by. natural calamities like earthquake, tsunami, etc.

Industry:

• An economic activity in which raw materials are processed to add utility to the material and convert them into useful products which can satisfy human needs is called an industry.
• For example, when a textile industry owner process cotton and converts it into a product say a shirt he is adding utility to the raw material i.e. cotton, and satisfying the need of humans to wear a shirt.
• Other examples are manufacturer manufacturing furniture from wood, a shoe company that makes shoes from leather, etc.

Characteristics of industry:

• Production, economic activity, changing the form of raw material, producing various articles, adding utility, etc. are ail characteristics of an industry.
• Moreover, use of human labour, natural wealth and machineries are also included in characteristics of an industry.

Commerce:

• Commerce can be termed as a combination of trade and auxiliary services that help trade.
• Trading is not always an independent activity. A trader may need various services such as banking, insurance, transportation, communication, warehousing, commission agents, etc. All these services are called auxiliary services.
• When a trader starts making use of auxiliary services we can say he has risen above trading and has entered into commerce.

Characteristics of Commerce:

• Trade is a part of commerce. In other words commerce is a super set.
• Commerce is an economic activity.
• Commerce includes auxiliary services such as banking, insurance, transport, etc. that help to trade.
• Commerce increases time and place utility of goods.
• Auxiliary services are demand oriented yet continuous in nature.
• If auxiliary services are available at reasonable prices, goods can be supplied to customers at fair price.

The objective of social responsibility:

• Business is not an independent activity. It interacts with various groups/ classes of people of society associated with business directly or indirectly but with different interests. Business interacts with owners, employees, creditors, government, etc.
• It is quite important to take care of the interests of these different groups of society.
• To do so, business has abide by the laws to maintain the business environment, follow the Employee Welfare Act, Factory Act, Consumer Protection Act, etc.
• Factors like rise in consumer awareness, rules and restrictions imposed by state, consumer associations and increased education compel a business to fulfill these social responsibilities.

Correct option is (A) An employee

Two; Economic activity and Non-economic Name them. activity.

When a person does an activity without the aim of earning mony or gaining any economic benefit, the activity is called non-economic activity.

Correct option is (B) An employee

Correct option is (B) Financial return

In the absence of partnership deed the provision affecting of Indian partnership act, 1932 are applicable 

The important rules are as follows:

(a) Interest on partners capital — No Interest on capital is to be paid 

(b) Interest on partners drawings — No Interest on drawing is to be charged 

(c) Interest on partners loan — Interest on loan is to be given at 6% per annum 

(d) Partners profit sharing ratio — Profit and losses are to be shared equally 

(e) Salaries of partners — No salary is payable to partners