Partnerships: Formation & Final Accounts is one of 9 topics in the Grade 11 Accounting CAPS syllabus, covered across 3 lessons on Study Vault. Below are real practice questions from this topic with full worked answers.
Sample practice questions
Easy
1. Unlike a sole trader, a partnership keeps, for each partner, a:
Separate Capital account and a separate Current account
Single combined Capital account for all partners together
Only a Drawings account, with no Capital account
Only a Current account, with no Capital account
Answer: Separate Capital account and a separate Current account — Each partner has their own individual Capital account (fixed investment) and Current account (ongoing movements: salary, interest on capital, share of profit, drawings).
Easy
2. Interest on capital is calculated as:
Partner's Capital balance x Interest Rate%
Partner's Current account balance x Interest Rate%
Net profit x Interest Rate%
Partner's Drawings x Interest Rate%
Answer: Partner's Capital balance x Interest Rate% — Interest on capital rewards a partner for the fixed capital amount they have invested, calculated as that partner's Capital balance multiplied by the agreed interest rate.
Medium
3. Partner Naledi has a fixed Capital balance of R200 000. The partnership agreement provides for interest on capital of 10% p.a. Calculate Naledi's interest on capital for the year, in rand.
Answer: 20000 — Interest on capital = 200000 x 10% = R20 000.
