A partnership can have maximum 50 partners. This limit has been set by the
- Central Government
- State Government
- Indian Contract Act, 1872
- Indian Partnership Act, 1932
The Correct Option is A
Approach Solution - 1
The maximum limit of 50 partners in a partnership is determined by the Central Government.
The partnership is governed by regulations that are influenced by several governmental and legal entities. For understanding the limitation on the number of partners, the key factor is the legislative authority.
The correct choice given the options is the Central Government, which sets regulatory guidelines overseeing the maximum partner limit in a partnership to ensure streamlined business operations and compliance with the law.
Approach Solution -2
Under the Indian Partnership Act, 1932, a partnership firm can have a maximum of 20 partners. However, this limit can be extended to 50 partners under the provisions of the Companies Act.
The law also allows a partnership firm to have more than 20 but not more than 50 partners if the firm is registered under the Companies Act and if the partnership business involves professionals like lawyers, doctors, etc. The limit of 50 partners is set by the Central Government.
Therefore, the correct answer is: (1) Central Government
Top Questions on Partnership Accounts
Rupal, Shanu and Trisha were partners in a firm sharing profits and losses in the ratio of 4:3:1. Their Balance Sheet as at 31st March, 2024 was as follows:
(i) Trisha's share of profit was entirely taken by Shanu.
(ii) Fixed assets were found to be undervalued by Rs 2,40,000.
(iii) Stock was revalued at Rs 2,00,000.
(iv) Goodwill of the firm was valued at Rs 8,00,000 on Trisha's retirement.
(v) The total capital of the new firm was fixed at Rs 16,00,000 which was adjusted according to the new profit sharing ratio of the partners. For this necessary cash was paid off or brought in by the partners as the case may be.
Prepare Revaluation Account and Partners' Capital Accounts.- CBSE CLASS XII - 2025
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- Anuj and Kartik were partners in a firm sharing profits and losses in the ratio of 5 : 4. Anuj withdrew ₹ 20,000 at the beginning of every month starting 1st April, 2023 to 31st March, 2024. Interest on drawings is charged @ 6% p.a. The interest on drawings will be:
- CBSE CLASS XII - 2025
- Accountancy
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Bittu and Chintu were partners in a firm sharing profit and losses in the ratio of 4 : 3. Their Balance Sheet as at 31st March, 2024 was as follows:
On 1st April, 2024, Diya was admitted in the firm for \( \frac{1}{7} \)th share in the profits on the following terms:- (i) New profit sharing ratio between Bittu, Chintu and Diya was 3 : 3 : 1 .
- (ii) Fixed Assets were found to be overvalued by ₹ 1,40,000.
- (iii) Creditors were paid ₹ 4,20,000 in full settlement.
- (iv) Diya brought proportionate capital and ₹ 5,60,000 as her share of goodwill premium by cheque.
Prepare Revaluation Account and Partners' Capital Accounts.
- CBSE CLASS XII - 2025
- Accountancy
- Partnership Accounts
- Radhika, Mehar and Shubha were partners in a firm sharing profits and losses in the ratio of 9 : 8 : 7. If Radhika's share of profit at the end of the year amounted to Rs 5,40,000, Shubha's share of profit will be :
- CBSE CLASS XII - 2025
- Accountancy
- Partnership Accounts
- Aakash and Baadal entered into partnership on 1st October, 2023 with the capitals of Rs 80,00,000 and Rs 60,00,000 respectively. They decided to share profits and losses equally. Partners were entitled to interest on capital @ 10\% per annum as per the provisions of the partnership deed. Baadal is given a guarantee that his share of profit, after charging interest on capital will not be less than Rs 7,00,000 per annum. Any deficiency arising on that account shall be met by Aakash. The profit of the firm for the year ended 31st March, 2024 amounted to Rs 13,00,000. Prepare Profit and Loss Appropriation Account for the year ended 31st March, 2024.
- CBSE CLASS XII - 2025
- Accountancy
- Partnership Accounts
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