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CA Foundation · Accounting · Partnership and LLP Accounts

Arora, Bhatia and Chopra are partners in an LLP with no agreement on profit sharing. The LLP earns a profit of ₹1,80,000 for the year. Under the default position in the LLP Act, 2008, how much profit is Bhatia entitled to?

Bhatia is entitled to ₹60,000. When the LLP agreement is silent, the LLP Act treats all partners as equally entitled to share profits, so ₹1,80,000 divided among three partners gives ₹60,000 each.

  1. A₹60,000Correct
  2. B₹90,000
  3. C₹1,20,000
  4. D₹1,80,000

Explanation

Where the LLP agreement is silent, the Act provides that all partners are equally entitled to share profits. Profit per partner is 1,80,000 / 3 = ₹60,000. Allocating by capital is not the default rule, so other figures are wrong.

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