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A and B are partners sharing profits in the ratio of 2 : 1. They decided to admit C, their manager, as a partner form 1st April, 2017, giving him 1/5th share of profit. C, while a manager, was getting a salary of ₹ 50,000 p.a. plus a commission of 10% of the net profit after charging such salary and commission. It was also agreed that any excess amount which C receives as a partner (over his salary and commission) will be borne by A. Profit for the year ended 31st March, 2018 amounted to ₹ 6,44,000, before payment of salary and commission. Prepare Profit and Loss Appropriation Account. |
| Answer» A and B are partners sharing profits in the ratio of 2 : 1. They decided to admit C, their manager, as a partner form 1st April, 2017, giving him 1/5th share of profit. C, while a manager, was getting a salary of ₹ 50,000 p.a. plus a commission of 10% of the net profit after charging such salary and commission. It was also agreed that any excess amount which C receives as a partner (over his salary and commission) will be borne by A. Profit for the year ended 31st March, 2018 amounted to ₹ 6,44,000, before payment of salary and commission. Prepare Profit and Loss Appropriation Account. | |