1.

Piya and Bina are partners in a firm sharing profits and losses in the ratio of 3 : 2. Following was the Balance Sheet of the firm as on 31st March, 2016: The profits ₹ 30,000 for the year ended 31st March, 2016 were divided between the partners without allowing interest on capital @ 12% p.a. salary to Piya @ ₹ 1,000 per month. During the year Piya withdrew ₹ 8,000 and Bina withdrew ₹ 4,000. Showing your working notes clearly, pass the necessary rectifying entry.

Answer»

rnal entry and the adjusting table are calculated below:Explanation:Given,PIYA and Bina sharing PROFITS and losses in the RATIO of 3 : 2Piya WITHDREW ₹ 8,000 and Bina withdrew ₹ 4,000.The profit for the year ended is RS. 30,000Calculation of Interest on Capital Interest on Piya's Capital: Interest on Bina's Capital: Thus, as per the journal entry given below, an amount of Rs. 5856 has been debited from Bina's Capital account and has been credited to Piya's Capital account.



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