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InterviewSolution
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X, Y and Z entered into partnership on 1st October, 2017 to share profits and losses in the ratio of 4 : 3 : 3. X, personally guaranteed that Z’s share of profit after charging interest on capital @ 10% p.a. would not be less then ₹ 80,000 in any year. The capital contributions were: X ₹ 3,00,000, Y ₹ 2,00,000 and Z ₹ 1,50,000. The profit for the year ended 31st March, 2018 amounted to ₹ 1,60,000. Prepare Profit and Loss Appropriation Account. |
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Answer» n: Profit and Loss Appropriation Account as on 31" March 2018 Dr Cr Particulars Rs. Particulars Rs. To Interest on Capital A/c By Net Profit b/d 1,60,000 X 15,000 Y 10,000 Z 7,500 32,500 To Profit transferred to : X's A/c (51,000 - 1,750) 49,250 Y's A/c (38,250) 38,250 Z's A/c (38,250 + 1,750) 40,000 1,27,500 1 60 000 1 60 000 NOTE: Z is admitted on 1" October,2017 and Profit is ascertained on March 31,2018, therefore interest on Capital is to be calculated for 6 months and GUARANTEED amount is considered as Rs.40,000, i.e. half of the total amount. |
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