InterviewSolution
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InterviewSolution
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A, B and C were partners in a firm having capitals of ₹ 50,000 ; ₹ 50,000 and ₹ 1,00,000 respectively. Their Current Account balances were A: ₹ 10,000; B: ₹ 5,000 and C: ₹ 2,000 (Dr.). According to the Partnership Deed the partners were entitled to an interest on Capital 10% p.a. C being the working partner was also entitled to a salary of ₹ 12,000 p.a. The profits were to be capitals:(a) The first ₹ 20,000 in proportion to their capitals.(b) Next ₹ 30,000 in the ratio of 5 : 3 : 2.(c) Remaining profits to be shared equally.The firm earned net profit of ₹ 1,72,000 before charging any of the above items.Prepare Profit and Loss Appropriation Account and pass necessary Journal entry for the appropriation of profits. |
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Answer» A, B and C were partners in a firm having capitals of ₹ 50,000 ; ₹ 50,000 and ₹ 1,00,000 respectively. Their Current Account balances were A: ₹ 10,000; B: ₹ 5,000 and C: ₹ 2,000 (Dr.). According to the Partnership Deed the partners were entitled to an interest on Capital 10% p.a. C being the working partner was also entitled to a salary of ₹ 12,000 p.a. The profits were to be capitals: (a) The first ₹ 20,000 in proportion to their capitals. (b) Next ₹ 30,000 in the ratio of 5 : 3 : 2. (c) Remaining profits to be shared equally. The firm earned net profit of ₹ 1,72,000 before charging any of the above items. Prepare Profit and Loss Appropriation Account and pass necessary Journal entry for the appropriation of profits. |
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