1.

B,V and M were in partnership sharing profits and losses in the ratio of 3 : 2 : 1. Their fixed capitals were Rs 5,00,000; Rs 4,00,000 and Rs 3,00,000 respectively. The partnership deed provided for the following : (i) Interest on capital 6 % p.a. (ii) Salary of Rs 40,000 to M (iii) Interest on partners drawings will be charged 12% p.a. During the year ended 31st March, 2018 the firm earned a profit of Rs 2,70,000. Interest on drawings were Rs 1,200, Rs 720 and Rs 450 respectively. Prepare Profit and Loss Appropriation Account for the year ending on March 31st 2018.

Answer»

B,V and M were in partnership sharing profits and losses in the ratio of 3 : 2 : 1. Their fixed capitals were Rs 5,00,000; Rs 4,00,000 and Rs 3,00,000 respectively. The partnership deed provided for the following :

(i) Interest on capital 6 % p.a.

(ii) Salary of Rs 40,000 to M

(iii) Interest on partners drawings will be charged 12% p.a.

During the year ended 31st March, 2018 the firm earned a profit of Rs 2,70,000. Interest on drawings were Rs 1,200, Rs 720 and Rs 450 respectively. Prepare Profit and Loss Appropriation Account for the year ending on March 31st 2018.



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