TS Grewal i (2014) Solutions for Class 12 Commerce Accountancy Chapter 1 Accounting For Partnership Firms Fundamentals are provided here with simple step-by-step explanations. These solutions for Accounting For Partnership Firms Fundamentals are extremely popular among class 12 Commerce students for Accountancy Accounting For Partnership Firms Fundamentals Solutions come handy for quickly completing your homework and preparing for exams. All questions and answers from the TS Grewal i (2014) Book of class 12 Commerce Accountancy Chapter 1 are provided here for you for free. You will also love the ad-free experience on Meritnation’s TS Grewal i (2014) Solutions. All TS Grewal i (2014) Solutions for class 12 Commerce Accountancy are prepared by experts and are 100% accurate.
Page No 1.64:
Question 1:
Answer:
Items (Points) | Provision in the Absence of Partnership Deed | |
(a) | Salaries of Partners | No Salary will be allowed to Partners. |
(b) | Interest on Partners’ Capitals | No interest will be allowed to Partners on Capital |
(c) | Interest on Partners’ Loan | 6% p.a. Interest will be allowed on the amount given by partners in the form of Loans and Advances to firm. |
(d) | Division of Profit | Profits will be shared equally, it is irrespective the amount of capital contributed by partners |
(e) | Interest on Partners’ Drawings | No Interest will be charged on the Drawings of Partners |
Page No 1.65:
Question 2:
Items (Points) | Provision in the Absence of Partnership Deed | |
(a) | Salaries of Partners | No Salary will be allowed to Partners. |
(b) | Interest on Partners’ Capitals | No interest will be allowed to Partners on Capital |
(c) | Interest on Partners’ Loan | 6% p.a. Interest will be allowed on the amount given by partners in the form of Loans and Advances to firm. |
(d) | Division of Profit | Profits will be shared equally, it is irrespective the amount of capital contributed by partners |
(e) | Interest on Partners’ Drawings | No Interest will be charged on the Drawings of Partners |
Answer:
(a) P is bound to pay Rs 20,000 together with profit of Rs 5,000 to the firm because this amount belongs to the firm.
Explanation: As per Principal and Agent relationship, P is principal as well as agent to the firm and to Q and R. As per this rule, any profit earned by an agent (P) by using the firm’s property is attributable to the firm.
(b) Q is liable to pay Rs 5,000 to the firm. As per the Partnership Act, 1932, every partner of a partnership firm is liable to the firm for any loss caused by his/her willful negligence.
Explanation: Here Q is solely responsible for the loss of Rs 1,000 because he used the property of the firm and also represented himself as a principal rather than an agent to the other partners and to the firm.
(c) P and Q may buy goods from A Ltd.
Explanation: As per Partnership Act, 1932, a partner has a right to buy and sell goods without consulting the other partners unless a Public Notice has been given by the partnership firm to restrict the partners to buy and sell.
(d) C will not be admitted because one of the partners P has not agreed to admit C.
Explanation: As per Partnership Act, a new partner cannot be admitted into a firm unless all the existing partners agree on the same decision. In other words, a new partner can be admitted in a partnership firm with the consent of all the existing partners.
Page No 1.65:
Question 3:
(a) P is bound to pay Rs 20,000 together with profit of Rs 5,000 to the firm because this amount belongs to the firm.
Explanation: As per Principal and Agent relationship, P is principal as well as agent to the firm and to Q and R. As per this rule, any profit earned by an agent (P) by using the firm’s property is attributable to the firm.
(b) Q is liable to pay Rs 5,000 to the firm. As per the Partnership Act, 1932, every partner of a partnership firm is liable to the firm for any loss caused by his/her willful negligence.
Explanation: Here Q is solely responsible for the loss of Rs 1,000 because he used the property of the firm and also represented himself as a principal rather than an agent to the other partners and to the firm.
(c) P and Q may buy goods from A Ltd.
Explanation: As per Partnership Act, 1932, a partner has a right to buy and sell goods without consulting the other partners unless a Public Notice has been given by the partnership firm to restrict the partners to buy and sell.
(d) C will not be admitted because one of the partners P has not agreed to admit C.
Explanation: As per Partnership Act, a new partner cannot be admitted into a firm unless all the existing partners agree on the same decision. In other words, a new partner can be admitted in a partnership firm with the consent of all the existing partners.
Answer:
|
Disputes |
Possible Judgements |
(a) |
A wants that interest on capital should be allowed to the partners but B and C do not agree. |
As per Partnership Act, no interest on Capital will be allowed. Reason: There is no partnership agreement among A, B and C regarding interest on capital. |
(b) |
B wants that the partners should be allowed to draw salary but A and C do not agree. |
No salary will be allowed to any partner. Reason: There is no partnership agreement. |
(c) |
C wants that the loan given by him to the firm should bear interest @ 10% p.a. but A and B do not agree. |
Interest on partner’s loan (C’s loan) will be allowed at 6% p.a. Reason: As per Partnership Act, in the absence of partnership agreement, interest on partners loan is allowed at 6% p.a. |
(d) |
A and B having contributed larger amounts of capital, desire that the profits should be divided in the ratio of their capital contribution but C does not agree. |
Profit will be shared equally and not in the capital ratio. Reason: There is no partnership agreement. |
Page No 1.65:
Question 4:
|
Disputes |
Possible Judgements |
(a) |
A wants that interest on capital should be allowed to the partners but B and C do not agree. |
As per Partnership Act, no interest on Capital will be allowed. Reason: There is no partnership agreement among A, B and C regarding interest on capital. |
(b) |
B wants that the partners should be allowed to draw salary but A and C do not agree. |
No salary will be allowed to any partner. Reason: There is no partnership agreement. |
(c) |
C wants that the loan given by him to the firm should bear interest @ 10% p.a. but A and B do not agree. |
Interest on partner’s loan (C’s loan) will be allowed at 6% p.a. Reason: As per Partnership Act, in the absence of partnership agreement, interest on partners loan is allowed at 6% p.a. |
(d) |
A and B having contributed larger amounts of capital, desire that the profits should be divided in the ratio of their capital contribution but C does not agree. |
Profit will be shared equally and not in the capital ratio. Reason: There is no partnership agreement. |
Answer:
Amount of Loan given by M to the firm (on July 01, 2012) = Rs 8,000
Time period (from July 01, 2012 to March 31, 2013) = 9 months
Interest rate = 6% p.a.
Note: There is no partnership agreement between the partners M and N regarding interest on loan. As per the Partnership Act, in case the partnership agreement is silent, interest on loan is allowed on the amount advanced or loan given by a partner to the firm at 6% p.a.
Page No 1.65:
Question 5:
Amount of Loan given by M to the firm (on July 01, 2012) = Rs 8,000
Time period (from July 01, 2012 to March 31, 2013) = 9 months
Interest rate = 6% p.a.
Note: There is no partnership agreement between the partners M and N regarding interest on loan. As per the Partnership Act, in case the partnership agreement is silent, interest on loan is allowed on the amount advanced or loan given by a partner to the firm at 6% p.a.
Answer:
Time Period (from July 01 to December 31, 1998) = 6 months
Interest rate = 6% p.a. (in the absence of partnership deed)
A and B will get Rs 450 individually as interest on loan for 6 months (from July 01 to December 1998) at 6% p.a.
Page No 1.65:
Question 6:
Time Period (from July 01 to December 31, 1998) = 6 months
Interest rate = 6% p.a. (in the absence of partnership deed)
A and B will get Rs 450 individually as interest on loan for 6 months (from July 01 to December 1998) at 6% p.a.
Answer:
Profit and Loss Account as on March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Mahesh’s Loan |
150 |
Net Profit |
15,200 |
|
Profit transferred to: |
|
|
|
|
Mahesh’s Capital A/c |
7,525 |
|
|
|
Ramesh’s Capital A/c |
7,525 |
15,050 |
|
|
|
15,200 |
|
15,200 |
|
|
|
|
|
Working Note:
WN 1 Calculation of Interest on Mahesh’s Loan
Amount of Loan given by Mahesh = Rs 10,000
Time Period (from Jan 01 to March 31, 2012) = 3 months
WN 2: Calculation of Interest on Capital
No interest on Capital will be allowed to the partners
Note: There is no partnership deed between Mahesh and Ramesh. Therefore, as per Partnership Act:
(a) Interest on Loan will be allowed at 6% p.a.
(b) No interest on Partners’ Capital will be allowed and
(c) Profit after Interest on Mahesh’s loan will be distributed equally between Mahesh and Ramesh.
Page No 1.65:
Question 7:
Profit and Loss Account as on March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Mahesh’s Loan |
150 |
Net Profit |
15,200 |
|
Profit transferred to: |
|
|
|
|
Mahesh’s Capital A/c |
7,525 |
|
|
|
Ramesh’s Capital A/c |
7,525 |
15,050 |
|
|
|
15,200 |
|
15,200 |
|
|
|
|
|
Working Note:
WN 1 Calculation of Interest on Mahesh’s Loan
Amount of Loan given by Mahesh = Rs 10,000
Time Period (from Jan 01 to March 31, 2012) = 3 months
WN 2: Calculation of Interest on Capital
No interest on Capital will be allowed to the partners
Note: There is no partnership deed between Mahesh and Ramesh. Therefore, as per Partnership Act:
(a) Interest on Loan will be allowed at 6% p.a.
(b) No interest on Partners’ Capital will be allowed and
(c) Profit after Interest on Mahesh’s loan will be distributed equally between Mahesh and Ramesh.
Answer:
Profit and Loss Appropriation Account as on March 31, 2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Partnersâ Capital- |
|
Net Profit (27,100 - 600) |
26,500 |
|
Black |
1,500 |
|
|
|
White |
1,000 |
2,500 |
|
|
Profit transferred to- |
|
|
|
|
Blackâs Capital A/c |
12,000 |
|
|
|
Whiteâs Capital A/c |
12,000 |
24,000 |
|
|
|
26,500 |
|
26,500 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Whiteâs Loan
Notes:
1. As per Partnership Agreement, interest on capital to the partners is to be allowed at 5%.
2. There is no partnership agreement for interest on loan provided by the partner. Hence, interest on loan is allowed at 6%.
3. There is no partnership agreement for salary to the partners, therefore no salary will be provided to any of the partner.
4. Also, in the absence of a partnership agreement regarding sharing of profits and losses, profits will be shared equally by the partners.
Page No 1.66:
Question 8:
Profit and Loss Appropriation Account as on March 31, 2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Partnersâ Capital- |
|
Net Profit (27,100 - 600) |
26,500 |
|
Black |
1,500 |
|
|
|
White |
1,000 |
2,500 |
|
|
Profit transferred to- |
|
|
|
|
Blackâs Capital A/c |
12,000 |
|
|
|
Whiteâs Capital A/c |
12,000 |
24,000 |
|
|
|
26,500 |
|
26,500 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Whiteâs Loan
Notes:
1. As per Partnership Agreement, interest on capital to the partners is to be allowed at 5%.
2. There is no partnership agreement for interest on loan provided by the partner. Hence, interest on loan is allowed at 6%.
3. There is no partnership agreement for salary to the partners, therefore no salary will be provided to any of the partner.
4. Also, in the absence of a partnership agreement regarding sharing of profits and losses, profits will be shared equally by the partners.
Answer:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
80,000 |
||
A |
6,000 |
|
|
|
|
B |
3,600 |
9,600 |
|
|
|
Salary to B (Rs 3,000×12) |
36,000 |
|
|
||
Profit transferred to: |
|
|
|
||
A’s Capital A/c |
17,200 |
|
|
|
|
B’s Capital A/c |
17,200 |
34,400 |
|
|
|
|
80,000 |
|
80,000 |
||
|
|
|
|
Working Notes:
WN1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Divisible Profit = 80,000 – 9,600 – 36,000 = 34,400
Page No 1.66:
Question 9:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
80,000 |
||
A |
6,000 |
|
|
|
|
B |
3,600 |
9,600 |
|
|
|
Salary to B (Rs 3,000×12) |
36,000 |
|
|
||
Profit transferred to: |
|
|
|
||
A’s Capital A/c |
17,200 |
|
|
|
|
B’s Capital A/c |
17,200 |
34,400 |
|
|
|
|
80,000 |
|
80,000 |
||
|
|
|
|
Working Notes:
WN1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Divisible Profit = 80,000 – 9,600 – 36,000 = 34,400
Answer:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit after Z’s salary) |
4,00,000 |
||
X |
50,000 |
|
|
|
|
Y |
50,000 |
|
|
|
|
Z |
25,000 |
1,25000 |
|
|
|
Profit transferred to: |
|
|
|
||
X’s Capital A/c |
1,10,000 |
|
|
|
|
Y’s Capital A/c |
1,10,000 |
|
|
|
|
Z’s Capital A/c |
55,000 |
2,75,000 |
|
|
|
|
4,00,000 |
|
4,00,000 |
||
|
|
|
|
Working Notes:
WN 1 Salary to Z has not been debited to Profit and Loss Appropriation Account. This is because Profit of Rs 4,00,000 is given after adjusting the Z’s salary.
WN 2 Calculation of Interest on Capital
WN 3 Calculation of Profit Share of each Partner
Divisible of Profit after Interest on Capital = Rs 4,00,000 − Rs 1,25,000 = Rs 2,75,000
Profit sharing ratio = 2 : 2 : 1
Page No 1.66:
Question 10:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit after Z’s salary) |
4,00,000 |
||
X |
50,000 |
|
|
|
|
Y |
50,000 |
|
|
|
|
Z |
25,000 |
1,25000 |
|
|
|
Profit transferred to: |
|
|
|
||
X’s Capital A/c |
1,10,000 |
|
|
|
|
Y’s Capital A/c |
1,10,000 |
|
|
|
|
Z’s Capital A/c |
55,000 |
2,75,000 |
|
|
|
|
4,00,000 |
|
4,00,000 |
||
|
|
|
|
Working Notes:
WN 1 Salary to Z has not been debited to Profit and Loss Appropriation Account. This is because Profit of Rs 4,00,000 is given after adjusting the Z’s salary.
WN 2 Calculation of Interest on Capital
WN 3 Calculation of Profit Share of each Partner
Divisible of Profit after Interest on Capital = Rs 4,00,000 − Rs 1,25,000 = Rs 2,75,000
Profit sharing ratio = 2 : 2 : 1
Answer:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
2,16,000 |
||
Amit |
20,000 |
|
Interest on Drawings A/c: |
|
|
Vijay |
15,000 |
35,000 |
Amit |
2,200 |
|
Salary to: |
|
Vijay |
2,500 |
4,700 |
|
Amit (Rs 2,000 × 12) |
24,000 |
|
|
|
|
Vijay (Rs 3,000 × 12) |
36,000 |
60,000 |
|
|
|
Profit transferred to: |
|
|
|
||
Amit’s Capital A/c |
75,420 |
|
|
|
|
Vijay’s Capital A/c |
50,280 |
1,25,700 |
|
|
|
|
2,20,700 |
|
2,20,700 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Divisible Profit = 2,16,000 + 4,700 − 35,000 − 60,000 = Rs 1, 25,700
Profit sharing ratio = 3 : 2
Page No 1.66:
Question 11:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
2,16,000 |
||
Amit |
20,000 |
|
Interest on Drawings A/c: |
|
|
Vijay |
15,000 |
35,000 |
Amit |
2,200 |
|
Salary to: |
|
Vijay |
2,500 |
4,700 |
|
Amit (Rs 2,000 × 12) |
24,000 |
|
|
|
|
Vijay (Rs 3,000 × 12) |
36,000 |
60,000 |
|
|
|
Profit transferred to: |
|
|
|
||
Amit’s Capital A/c |
75,420 |
|
|
|
|
Vijay’s Capital A/c |
50,280 |
1,25,700 |
|
|
|
|
2,20,700 |
|
2,20,700 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Divisible Profit = 2,16,000 + 4,700 − 35,000 − 60,000 = Rs 1, 25,700
Profit sharing ratio = 3 : 2
Answer:
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
1,72,000 |
|
A |
5,000 |
|
|
|
B |
5,000 |
|
|
|
C |
10,000 |
20,000 |
|
|
Salary to C |
|
12,000 |
|
|
Profit transferred to: |
|
|
|
|
A’s Current A/c |
50,000 |
|
|
|
B’s Current A/c |
44,000 |
|
|
|
C’s Current A/c |
46,000 |
1,40,000 |
|
|
|
1,72,000 |
|
1,72,000 |
|
|
|
|
|
Journal Entries |
|||||
Date |
Particulars |
|
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
|
|
|
|
|
Interest on Capital A/c |
Dr. |
|
20,000 |
|
|
To A’s Current A/c |
|
|
|
5,000 |
|
To B’s Current A/c |
|
|
|
5,000 |
|
To C’s Current A/c |
|
|
|
10,000 |
|
(Interest on partners’ capital allowed to partners) |
|
|
|
|
|
|
|
|
|
|
|
Salary A/c |
Dr. |
|
12,000 |
|
|
To C’s Current A/c |
|
|
|
12,000 |
|
(Salary allowed to C) |
|
|
|
|
|
|
|
|
|
|
|
Profit and Loss Appropriation A/c |
Dr. |
|
1,40,000 |
|
|
To A’s Current A/c |
|
|
|
50,000 |
|
To B’s Current A/c |
|
|
|
44,000 |
|
To C’s Current A/c |
|
|
|
46,000 |
|
(Profit available for distribution transferred to partners’ current accounts) |
|
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profits available for Distribution = 1,72,000 − 20,000 − 12,000
= Rs 1,40,000
1. Distribution of first Rs 20,000 in the Capital Ratio i.e. 1:1:2
2. Distribution of Next Rs 30,000 in the ratio of 5:3:2
3. Remaining Profit available for distribution = Rs 1,40,000 − 20,000 − 30,000 = Rs 90,000
This profit of Rs 90,000 is to be shared equally by the partners.
Therefore,
Total Profit Share of A = 5,000 + 15,000 + 30,000 = Rs 50,000
Total Profit Share of B = 5,000 + 9,000 + 30,000 = Rs 44,000
Total Profit Share of C = 10,000 + 6,000 + 30,000 = Rs 46,000
Page No 1.66:
Question 12:
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
1,72,000 |
|
A |
5,000 |
|
|
|
B |
5,000 |
|
|
|
C |
10,000 |
20,000 |
|
|
Salary to C |
|
12,000 |
|
|
Profit transferred to: |
|
|
|
|
A’s Current A/c |
50,000 |
|
|
|
B’s Current A/c |
44,000 |
|
|
|
C’s Current A/c |
46,000 |
1,40,000 |
|
|
|
1,72,000 |
|
1,72,000 |
|
|
|
|
|
Journal Entries |
|||||
Date |
Particulars |
|
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
|
|
|
|
|
Interest on Capital A/c |
Dr. |
|
20,000 |
|
|
To A’s Current A/c |
|
|
|
5,000 |
|
To B’s Current A/c |
|
|
|
5,000 |
|
To C’s Current A/c |
|
|
|
10,000 |
|
(Interest on partners’ capital allowed to partners) |
|
|
|
|
|
|
|
|
|
|
|
Salary A/c |
Dr. |
|
12,000 |
|
|
To C’s Current A/c |
|
|
|
12,000 |
|
(Salary allowed to C) |
|
|
|
|
|
|
|
|
|
|
|
Profit and Loss Appropriation A/c |
Dr. |
|
1,40,000 |
|
|
To A’s Current A/c |
|
|
|
50,000 |
|
To B’s Current A/c |
|
|
|
44,000 |
|
To C’s Current A/c |
|
|
|
46,000 |
|
(Profit available for distribution transferred to partners’ current accounts) |
|
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profits available for Distribution = 1,72,000 − 20,000 − 12,000
= Rs 1,40,000
1. Distribution of first Rs 20,000 in the Capital Ratio i.e. 1:1:2
2. Distribution of Next Rs 30,000 in the ratio of 5:3:2
3. Remaining Profit available for distribution = Rs 1,40,000 − 20,000 − 30,000 = Rs 90,000
This profit of Rs 90,000 is to be shared equally by the partners.
Therefore,
Total Profit Share of A = 5,000 + 15,000 + 30,000 = Rs 50,000
Total Profit Share of B = 5,000 + 9,000 + 30,000 = Rs 44,000
Total Profit Share of C = 10,000 + 6,000 + 30,000 = Rs 46,000
Answer:
Profit and Loss Adjustment Account |
|||
Dr. |
|
|
Cr. |
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Manager’s Commission (30,000×5%) |
1,500 |
Profit and Loss A/c (Net Profit after Y’s salary) |
24,000 |
|
|
Y’s Salary |
6,000 |
Profit transferred to Profit and Loss |
|
|
|
Appropriation A/c |
28,500 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Salary to Y |
6,000 |
Profit and Loss Adjustment A/c |
28,500 |
|
Interest on Capital: |
|
(After manager’s commission) |
|
|
X |
4,000 |
|
|
|
Y |
3,000 |
7,000 |
|
|
Profit transferred to: |
|
|
|
|
X’s Capital A/c |
9,300 |
|
|
|
Y’s Capital A/c |
6,200 |
15,500 |
|
|
|
28,500 |
|
28,500 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Manager’s Commission
Profit for making Managers’ Commission = 24,000 + 6,000 (Y’s Salary) = Rs 30,000
WN 2 Calculation of Interest on Capital
WN 3 Calculation of Profit Share of each Partner
Profit available for distribution = 28,500 − 6,000 − 7,000 = Rs 15,500
Page No 1.66:
Question 13:
Profit and Loss Adjustment Account |
|||
Dr. |
|
|
Cr. |
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Manager’s Commission (30,000×5%) |
1,500 |
Profit and Loss A/c (Net Profit after Y’s salary) |
24,000 |
|
|
Y’s Salary |
6,000 |
Profit transferred to Profit and Loss |
|
|
|
Appropriation A/c |
28,500 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Salary to Y |
6,000 |
Profit and Loss Adjustment A/c |
28,500 |
|
Interest on Capital: |
|
(After manager’s commission) |
|
|
X |
4,000 |
|
|
|
Y |
3,000 |
7,000 |
|
|
Profit transferred to: |
|
|
|
|
X’s Capital A/c |
9,300 |
|
|
|
Y’s Capital A/c |
6,200 |
15,500 |
|
|
|
28,500 |
|
28,500 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Manager’s Commission
Profit for making Managers’ Commission = 24,000 + 6,000 (Y’s Salary) = Rs 30,000
WN 2 Calculation of Interest on Capital
WN 3 Calculation of Profit Share of each Partner
Profit available for distribution = 28,500 − 6,000 − 7,000 = Rs 15,500
Answer:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and loss A/c (Net Profit) |
3,50,000 |
||
D |
50,000 |
|
Interest on Drawings A/c: |
|
|
E |
70,000 |
|
D |
4,400 |
|
F |
80,000 |
2,00,000 |
E |
4,500 |
8,900 |
Salary to F (Rs 10,000 × 12) |
1,20,000 |
|
|
||
Profit transferred to: Capital A/c |
|
|
|
||
D’s Capital A/c |
9,725 |
|
|
|
|
E’s Capital A/c |
13,615 |
|
|
|
|
F’s Capital A/c |
15,560 |
38,900 |
|
|
|
|
3,58,900 |
|
3,58,900 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
No interest shall be charged on F’s drawings. This is because; F withdrew the amount at the end of year (on December 31, 2009).
WN 3 Calculation of Profit Share of each Partner
Profit available for distribution = 3,50,000 + 8,900 − 2,00,000 − 1,20,000 = 38,900
Profit Sharing Ratio = 5:7:8
Page No 1.67:
Question 14:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and loss A/c (Net Profit) |
3,50,000 |
||
D |
50,000 |
|
Interest on Drawings A/c: |
|
|
E |
70,000 |
|
D |
4,400 |
|
F |
80,000 |
2,00,000 |
E |
4,500 |
8,900 |
Salary to F (Rs 10,000 × 12) |
1,20,000 |
|
|
||
Profit transferred to: Capital A/c |
|
|
|
||
D’s Capital A/c |
9,725 |
|
|
|
|
E’s Capital A/c |
13,615 |
|
|
|
|
F’s Capital A/c |
15,560 |
38,900 |
|
|
|
|
3,58,900 |
|
3,58,900 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
No interest shall be charged on F’s drawings. This is because; F withdrew the amount at the end of year (on December 31, 2009).
WN 3 Calculation of Profit Share of each Partner
Profit available for distribution = 3,50,000 + 8,900 − 2,00,000 − 1,20,000 = 38,900
Profit Sharing Ratio = 5:7:8
Answer:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Salary to Prem (Rs 2,500 × 12) |
30,000 |
Profit and Loss A/c (Net Profit) |
90,575 |
||
Commission to Manoj |
10,000 |
Interest on Drawings A/c: |
|
||
Interest on Capital: |
|
Prem |
1,250 |
|
|
Prem |
10,000 |
|
Manoj |
425 |
1,675 |
Manoj |
7,500 |
17,500 |
|
|
|
Profit transferred to: |
|
|
|
||
Prem’s Current A/c |
20,850 |
|
|
|
|
Manoj’s Current A/c |
13,900 |
34,750 |
|
|
|
|
92,250 |
|
92,250 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = 90,575 + 1,675 − 30,000 − 10,000 − 17,500
= Rs 34,750
Profit sharing ratio = 3 : 2
Page No 1.67:
Question 15:
Profit and Loss Appropriation Account |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Salary to Prem (Rs 2,500 × 12) |
30,000 |
Profit and Loss A/c (Net Profit) |
90,575 |
||
Commission to Manoj |
10,000 |
Interest on Drawings A/c: |
|
||
Interest on Capital: |
|
Prem |
1,250 |
|
|
Prem |
10,000 |
|
Manoj |
425 |
1,675 |
Manoj |
7,500 |
17,500 |
|
|
|
Profit transferred to: |
|
|
|
||
Prem’s Current A/c |
20,850 |
|
|
|
|
Manoj’s Current A/c |
13,900 |
34,750 |
|
|
|
|
92,250 |
|
92,250 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = 90,575 + 1,675 − 30,000 − 10,000 − 17,500
= Rs 34,750
Profit sharing ratio = 3 : 2
Answer:
In this question, date of drawings made by the partners is not given. Therefore, interest on drawings is calculated on average basis for a period of six months.
Page No 1.67:
Question 16:
In this question, date of drawings made by the partners is not given. Therefore, interest on drawings is calculated on average basis for a period of six months.
Answer:
Since, the drawings are made evenly at the middle of every month, therefore interest on drawings is calculated for a period of six months.
Page No 1.67:
Question 17:
Since, the drawings are made evenly at the middle of every month, therefore interest on drawings is calculated for a period of six months.
Answer:
Page No 1.67:
Question 18:
Answer:
Page No 1.67:
Question 19:
Answer:
Date |
Amount (Rs) (I) |
No of Months (II) |
Product (Rs) (I ×II) |
1/5/2013 |
4,000 |
11 |
44,000 |
1/8/2013 |
10,000 |
8 |
80,000 |
30/9/2013 |
4,000 |
6 |
24,000 |
31/1/2014 |
12,000 |
2 |
24,000 |
1/3/2014 |
4,000 |
1 |
4,000 |
Sum of Product |
1,76,000 |
||
|
|
Rate of Interest = 7.5% p.a.
Page No 1.67:
Question 20:
Date |
Amount (Rs) (I) |
No of Months (II) |
Product (Rs) (I ×II) |
1/5/2013 |
4,000 |
11 |
44,000 |
1/8/2013 |
10,000 |
8 |
80,000 |
30/9/2013 |
4,000 |
6 |
24,000 |
31/1/2014 |
12,000 |
2 |
24,000 |
1/3/2014 |
4,000 |
1 |
4,000 |
Sum of Product |
1,76,000 |
||
|
|
Rate of Interest = 7.5% p.a.
Answer:
Total Drawings = 7,500 × 4 = Rs 30,000
Interest Rate = 10% p.a.
Case (a)
When equal amount is withdrawn in the beginning of each quarter, the interest on drawings is calculated for an average period of 7.5 months
Case (b)
When equal amount is withdrawn at the end of each quarter, the interest on drawings is calculated for an average period of 4.5 months
Case (c)
When equal amount is withdrawn in the middle of each quarter, the interest on drawings is calculated for an average period of 6 months
Page No 1.67:
Question 21:
Total Drawings = 7,500 × 4 = Rs 30,000
Interest Rate = 10% p.a.
Case (a)
When equal amount is withdrawn in the beginning of each quarter, the interest on drawings is calculated for an average period of 7.5 months
Case (b)
When equal amount is withdrawn at the end of each quarter, the interest on drawings is calculated for an average period of 4.5 months
Case (c)
When equal amount is withdrawn in the middle of each quarter, the interest on drawings is calculated for an average period of 6 months
Answer:
Calculation of Interest on A’s Capital
Date |
Capital |
× |
Period |
= |
Product |
April 01, 2013 to June 30, 2013 |
50,000 |
× |
3 |
= |
1,50,000 |
July 01, 2013 to March 31, 2014 |
60,000 |
× |
9 |
= |
5,40,000 |
Sum of Product |
|
6,90,000 |
|||
|
|
Calculation of Interest on B’s Capital
Date |
Capital |
× |
Period |
= |
Product |
April 01, 2013 to June 30, 2013 |
40,000 |
× |
3 |
= |
1,20,000 |
July 01, 2013 to March 31, 2014 |
41,000 |
× |
9 |
= |
3,69,000 |
Sum of Product |
|
4,89,000 |
|||
|
|
Page No 1.68:
Question 22:
Calculation of Interest on A’s Capital
Date |
Capital |
× |
Period |
= |
Product |
April 01, 2013 to June 30, 2013 |
50,000 |
× |
3 |
= |
1,50,000 |
July 01, 2013 to March 31, 2014 |
60,000 |
× |
9 |
= |
5,40,000 |
Sum of Product |
|
6,90,000 |
|||
|
|
Calculation of Interest on B’s Capital
Date |
Capital |
× |
Period |
= |
Product |
April 01, 2013 to June 30, 2013 |
40,000 |
× |
3 |
= |
1,20,000 |
July 01, 2013 to March 31, 2014 |
41,000 |
× |
9 |
= |
3,69,000 |
Sum of Product |
|
4,89,000 |
|||
|
|
Answer:
Calculation of Interest on Capital
Case (a)
Where there is no clean agreement except for interest on capitals
Profit for the year ended = Rs 1,500
Total amount of interest = Rs 1,800
Here, total amount of interest on capital is more than the profit available for distribution. Therefore, profit of Rs 1,500 is distributed between X and Y in the ratio of their interest on capital.
Particulars |
X |
: |
Y |
Interest on Capital |
1,200 |
: |
600 |
or, Ratio of interest on Capital |
2 |
: |
1 |
Case (b)
In case, there is a clear agreement that the interest on capital will be allowed even if the firm has incurred loss, then the whole amount of interest on capital is to be allowed to the partners.
Total Profit of the firm = Rs 1,500
Total amount of Interest on Capital = Rs 1,800 (i.e. Rs 1,200 + Rs 600). Therefore, loss to the firm amounts to Rs 300. This loss is to shared by X and Y in their profit sharing ratio that is 2 : 3.
Page No 1.68:
Question 23:
Calculation of Interest on Capital
Case (a)
Where there is no clean agreement except for interest on capitals
Profit for the year ended = Rs 1,500
Total amount of interest = Rs 1,800
Here, total amount of interest on capital is more than the profit available for distribution. Therefore, profit of Rs 1,500 is distributed between X and Y in the ratio of their interest on capital.
Particulars |
X |
: |
Y |
Interest on Capital |
1,200 |
: |
600 |
or, Ratio of interest on Capital |
2 |
: |
1 |
Case (b)
In case, there is a clear agreement that the interest on capital will be allowed even if the firm has incurred loss, then the whole amount of interest on capital is to be allowed to the partners.
Total Profit of the firm = Rs 1,500
Total amount of Interest on Capital = Rs 1,800 (i.e. Rs 1,200 + Rs 600). Therefore, loss to the firm amounts to Rs 300. This loss is to shared by X and Y in their profit sharing ratio that is 2 : 3.
Answer:
Calculation of Interest on A’s Capital
Date |
Capital |
× |
Period |
= |
Product |
April 01, 2013 to Sept 30, 2013 |
15,00,000 |
× |
6 |
= |
90,00,000 |
Oct 01, 2013 to March 31, 2014 |
12,00,000 |
× |
6 |
= |
72,00,000 |
Sum of Product |
|
1,62,00,000 |
|||
|
|
Calculation of Interest on B’s Capital
Date |
Capital |
× |
Period |
= |
Product |
April 01, 2013 to Sept 30, 2013 |
9,00,000 |
× |
6 |
= |
54,00,000 |
Oct 01, 2013 to March 31, 2014 |
12,00,000 |
× |
6 |
= |
72,00,000 |
Sum of Product |
|
1,26,00,000 |
|||
|
|
Page No 1.68:
Question 24:
Calculation of Interest on A’s Capital
Date |
Capital |
× |
Period |
= |
Product |
April 01, 2013 to Sept 30, 2013 |
15,00,000 |
× |
6 |
= |
90,00,000 |
Oct 01, 2013 to March 31, 2014 |
12,00,000 |
× |
6 |
= |
72,00,000 |
Sum of Product |
|
1,62,00,000 |
|||
|
|
Calculation of Interest on B’s Capital
Date |
Capital |
× |
Period |
= |
Product |
April 01, 2013 to Sept 30, 2013 |
9,00,000 |
× |
6 |
= |
54,00,000 |
Oct 01, 2013 to March 31, 2014 |
12,00,000 |
× |
6 |
= |
72,00,000 |
Sum of Product |
|
1,26,00,000 |
|||
|
|
Answer:
Interest on capital is calculated on the opening balance of partner’s capital.
Calculation of Capital balance at the beginning
Particulars |
Ram |
Mohan |
Capital at the end |
24,000 |
18,000 |
Less: Profit already credited (1:1) |
(8,000) |
(8,000) |
Add: Drawings already debited |
4,000 |
6,000 |
Capital at the beginning |
20,000 |
16,000 |
|
|
|
Page No 1.68:
Question 25:
Interest on capital is calculated on the opening balance of partner’s capital.
Calculation of Capital balance at the beginning
Particulars |
Ram |
Mohan |
Capital at the end |
24,000 |
18,000 |
Less: Profit already credited (1:1) |
(8,000) |
(8,000) |
Add: Drawings already debited |
4,000 |
6,000 |
Capital at the beginning |
20,000 |
16,000 |
|
|
|
Answer:
Calculation of Interest on Y’s Capital
Particulars |
Amount Rs |
Y’s Capital balance as on March 31, 2014 |
40,000 |
Less: Profit adjusted in Y’s Capital |
(5,000) |
Add: Drawings |
15,000 |
Capital Balance at the beginning (as on April 01, 2013) |
50,000 |
|
|
Page No 1.68:
Question 26:
Calculation of Interest on Y’s Capital
Particulars |
Amount Rs |
Y’s Capital balance as on March 31, 2014 |
40,000 |
Less: Profit adjusted in Y’s Capital |
(5,000) |
Add: Drawings |
15,000 |
Capital Balance at the beginning (as on April 01, 2013) |
50,000 |
|
|
Answer:
Calculation of Capital at the beginning (as on April 01, 2011)
Particulars |
Long |
Short |
Capital at the end |
1,60,000 |
1,40,000 |
Less: Adjusted Profit (1,50,000 – 1,00,000) in 1:1 ratio |
(25,000) |
(25,000) |
Add: Adjusted Drawings |
- |
50,000 |
Capital in the beginning |
1,35,000 |
1,65,000 |
|
|
|
Page No 1.68:
Question 27:
Calculation of Capital at the beginning (as on April 01, 2011)
Particulars |
Long |
Short |
Capital at the end |
1,60,000 |
1,40,000 |
Less: Adjusted Profit (1,50,000 – 1,00,000) in 1:1 ratio |
(25,000) |
(25,000) |
Add: Adjusted Drawings |
- |
50,000 |
Capital in the beginning |
1,35,000 |
1,65,000 |
|
|
|
Answer:
Calculation of Interest on Capital
Calculation of Interest on Drawings
Interest on A’s Drawings
Year 2010 |
Drawings |
× |
Period |
= |
Product |
March 31 to Dec. 31 |
500 |
× |
9 |
= |
4,500 |
April 30 to Dec. 31 |
600 |
× |
8 |
= |
4,800 |
July 01 to Dec 31 |
450 |
× |
6 |
= |
2,700 |
Dec 01 to Dec 31 |
1400 |
× |
1 |
= |
1,400 |
Sum of Product |
13,400 |
||||
|
|
Interest on B’s Drawings
Total Drawings = 300 ×12 = Rs 3,600
Average Period = 5.5 months
Page No 1.69:
Question 28:
Calculation of Interest on Capital
Calculation of Interest on Drawings
Interest on A’s Drawings
Year 2010 |
Drawings |
× |
Period |
= |
Product |
March 31 to Dec. 31 |
500 |
× |
9 |
= |
4,500 |
April 30 to Dec. 31 |
600 |
× |
8 |
= |
4,800 |
July 01 to Dec 31 |
450 |
× |
6 |
= |
2,700 |
Dec 01 to Dec 31 |
1400 |
× |
1 |
= |
1,400 |
Sum of Product |
13,400 |
||||
|
|
Interest on B’s Drawings
Total Drawings = 300 ×12 = Rs 3,600
Average Period = 5.5 months
Answer:
Net Profit before charging commission = Rs 1,10,000
Commission to A = 10% of on Net Profit before charging such commission
Page No 1.69:
Question 29:
Net Profit before charging commission = Rs 1,10,000
Commission to A = 10% of on Net Profit before charging such commission
Answer:
Net Profit before charging Commission = Rs 2,20,000
Commission to Z = 10% of on Net Profit after charging such commission
Page No 1.69:
Question 30:
Net Profit before charging Commission = Rs 2,20,000
Commission to Z = 10% of on Net Profit after charging such commission
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||||
Dr. |
Cr. |
|||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Partners’ Salary: |
|
Profit and Loss A/c (Net Profit) |
4,20,000 |
|||
X (10,000 × 12) |
1,20,000 |
|
|
|
||
Y |
25,000 |
1,45,000 |
|
|
||
Partners’ Commission: |
|
|
|
|||
X |
27,500 |
|
|
|
||
Y |
22,500 |
50,000 |
|
|
||
Profit transferred to: |
|
|
|
|||
X’s Capital A/c |
1,12,500 |
|
|
|
||
Y’s Capital A/c |
1,12,500 |
2,25,000 |
|
|
||
|
4,20,000 |
|
4,20,000 |
|||
|
|
|
|
Working Notes:
WN 1 Calculation of Commission
Commission to X = 10% of Net Profit after partners’ salaries but before charging such commission
Profit after Partners’ Salaries = 4,20,000 − 1,45,000 = Rs 2,75,000
Commission to Y = 10% of Net Profit after charging Commission and Partners’ Salaries
Profit after commission and partners’ salaries = 4,20,000 − 1,45,000 − 27,500
= Rs 2,47,500
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = 4,20,000 − 1,45,000 − 50,000 = Rs 2,25,000
Profit sharing ratio = 1 : 1
Page No 1.69:
Question 31:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||||
Dr. |
Cr. |
|||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Partners’ Salary: |
|
Profit and Loss A/c (Net Profit) |
4,20,000 |
|||
X (10,000 × 12) |
1,20,000 |
|
|
|
||
Y |
25,000 |
1,45,000 |
|
|
||
Partners’ Commission: |
|
|
|
|||
X |
27,500 |
|
|
|
||
Y |
22,500 |
50,000 |
|
|
||
Profit transferred to: |
|
|
|
|||
X’s Capital A/c |
1,12,500 |
|
|
|
||
Y’s Capital A/c |
1,12,500 |
2,25,000 |
|
|
||
|
4,20,000 |
|
4,20,000 |
|||
|
|
|
|
Working Notes:
WN 1 Calculation of Commission
Commission to X = 10% of Net Profit after partners’ salaries but before charging such commission
Profit after Partners’ Salaries = 4,20,000 − 1,45,000 = Rs 2,75,000
Commission to Y = 10% of Net Profit after charging Commission and Partners’ Salaries
Profit after commission and partners’ salaries = 4,20,000 − 1,45,000 − 27,500
= Rs 2,47,500
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = 4,20,000 − 1,45,000 − 50,000 = Rs 2,25,000
Profit sharing ratio = 1 : 1
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
|||||
Dr. |
Cr. |
||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Partners’ Commission: |
|
Profit and Loss A/c (Net Profit) |
1,80,000 |
||
A |
6,000 |
|
|
|
|
B |
9,000 |
|
|
|
|
C |
6,000 |
|
|
|
|
D |
9,000 |
30,000 |
|
|
|
Profit transferred to: |
|
|
|
||
A’s Capital A/c |
60,000 |
|
|
|
|
B’s Capital A/c |
45,000 |
|
|
|
|
C’s Capital A/c |
30,000 |
|
|
|
|
D’s Capital A/c |
15,000 |
1,50,000 |
|
|
|
|
1,80,000 |
|
1,80,000 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Partners’ Commission
Partners’ Commission = 20% on Net Profit after such commission
This commission is to be shared by the partners in the ratio of 2 : 3 : 2 : 3
WN 2 Calculation of Profit Share of each Partner
Profit available for Distribution = 1,80,000 − 30,000 = Rs 1,50,000
Profit sharing ratio = 4 : 3 : 2 : 1
Page No 1.69:
Question 32:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
|||||
Dr. |
Cr. |
||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Partners’ Commission: |
|
Profit and Loss A/c (Net Profit) |
1,80,000 |
||
A |
6,000 |
|
|
|
|
B |
9,000 |
|
|
|
|
C |
6,000 |
|
|
|
|
D |
9,000 |
30,000 |
|
|
|
Profit transferred to: |
|
|
|
||
A’s Capital A/c |
60,000 |
|
|
|
|
B’s Capital A/c |
45,000 |
|
|
|
|
C’s Capital A/c |
30,000 |
|
|
|
|
D’s Capital A/c |
15,000 |
1,50,000 |
|
|
|
|
1,80,000 |
|
1,80,000 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Partners’ Commission
Partners’ Commission = 20% on Net Profit after such commission
This commission is to be shared by the partners in the ratio of 2 : 3 : 2 : 3
WN 2 Calculation of Profit Share of each Partner
Profit available for Distribution = 1,80,000 − 30,000 = Rs 1,50,000
Profit sharing ratio = 4 : 3 : 2 : 1
Answer:
Amount advanced by the Partners = Rs 30,000
Profit sharing ratio = 3 : 2
Time Period (from October 01, 2009 to March 31, 2010) = 6 months
Interest rate = 6% p.a.
Calculation of Interest on Advances
Note: In the absence of a partnership agreement regarding rate of interest on loans and advances, interest is provided at 6% p.a.
Page No 1.69:
Question 33:
Amount advanced by the Partners = Rs 30,000
Profit sharing ratio = 3 : 2
Time Period (from October 01, 2009 to March 31, 2010) = 6 months
Interest rate = 6% p.a.
Calculation of Interest on Advances
Note: In the absence of a partnership agreement regarding rate of interest on loans and advances, interest is provided at 6% p.a.
Answer:
Calculation of Interest on Loan
Case 1- If Profits before any interest for the year amounted to Rs 21,000
Profit and Loss Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on X’s Loan |
2,400 |
Profit (before interest) |
21,000 |
|
Interest on Y’s Loan |
1,200 |
|
|
|
Profit transferred to |
|
|
|
|
X’s Capital A/c (17,400 × 2/5) |
6,960 |
|
|
|
Y’s Capital A/c (17,400 × 3/5) |
10,440 |
17,400 |
|
|
|
21,000 |
|
21,000 |
|
|
|
|
|
Case 2- If Profits before any interest for the year amounted to Rs 3,000
Profit and Loss Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on X’s Loan |
2,400 |
Profit (before interest) |
3,000 |
|
Interest on Y’s Loan |
1,200 |
Loss transferred to- |
|
|
|
|
X’s Capital A/c (600 × 2/5) |
240 |
|
|
|
Y’s Capital A/c (600 × (3/5) |
360 |
600 |
|
|
|
|
|
|
3,600 |
|
3,600 |
|
|
|
|
|
Case 3- If Profits before any interest for the year amounted to Rs 5,000
Profit and Loss Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on X’s Loan |
2,400 |
Profit (before interest) |
5,000 |
|
Interest on Y’s Loan |
1,200 |
|
|
|
Profit transferred to: |
|
|
|
|
X’s Capital A/c (1400 × 2/5) |
560 |
|
|
|
Y’s Capital A/c (1400 × 3/5) |
840 |
1,400 |
|
|
|
5,000 |
|
5,000 |
|
|
|
|
|
Page No 1.69:
Question 34:
Calculation of Interest on Loan
Case 1- If Profits before any interest for the year amounted to Rs 21,000
Profit and Loss Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on X’s Loan |
2,400 |
Profit (before interest) |
21,000 |
|
Interest on Y’s Loan |
1,200 |
|
|
|
Profit transferred to |
|
|
|
|
X’s Capital A/c (17,400 × 2/5) |
6,960 |
|
|
|
Y’s Capital A/c (17,400 × 3/5) |
10,440 |
17,400 |
|
|
|
21,000 |
|
21,000 |
|
|
|
|
|
Case 2- If Profits before any interest for the year amounted to Rs 3,000
Profit and Loss Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on X’s Loan |
2,400 |
Profit (before interest) |
3,000 |
|
Interest on Y’s Loan |
1,200 |
Loss transferred to- |
|
|
|
|
X’s Capital A/c (600 × 2/5) |
240 |
|
|
|
Y’s Capital A/c (600 × (3/5) |
360 |
600 |
|
|
|
|
|
|
3,600 |
|
3,600 |
|
|
|
|
|
Case 3- If Profits before any interest for the year amounted to Rs 5,000
Profit and Loss Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on X’s Loan |
2,400 |
Profit (before interest) |
5,000 |
|
Interest on Y’s Loan |
1,200 |
|
|
|
Profit transferred to: |
|
|
|
|
X’s Capital A/c (1400 × 2/5) |
560 |
|
|
|
Y’s Capital A/c (1400 × 3/5) |
840 |
1,400 |
|
|
|
5,000 |
|
5,000 |
|
|
|
|
|
Answer:
Profit and Loss Account for the year ended March 31, 2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Loss (before interest) |
9,000 |
Loss transferred to: |
|
|
Interest on Bat’s loan |
7,200 |
Bat’s Capital A/c |
7,920 |
|
Interest on Ball’s loan |
3,600 |
Ball’s Capital A/c |
11,880 |
19,800 |
|
19,800 |
|
19,800 |
|
|
|
|
|
Working Notes: WN 1 Interest on Partner’s Loan
WN 2 Distribution of Loss to the Partners
Loss after Interest on Partners’ Loan = 9,000 + 7,200 + 3,600 = Rs 19,800
Page No 1.70:
Question 35:
Profit and Loss Account for the year ended March 31, 2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Loss (before interest) |
9,000 |
Loss transferred to: |
|
|
Interest on Bat’s loan |
7,200 |
Bat’s Capital A/c |
7,920 |
|
Interest on Ball’s loan |
3,600 |
Ball’s Capital A/c |
11,880 |
19,800 |
|
19,800 |
|
19,800 |
|
|
|
|
|
Working Notes: WN 1 Interest on Partner’s Loan
WN 2 Distribution of Loss to the Partners
Loss after Interest on Partners’ Loan = 9,000 + 7,200 + 3,600 = Rs 19,800
Answer:
Profit and Loss Account for the year ended March 31, 2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on A’s Loan |
240 |
Profit (before Interest) |
15,000 |
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
7,380 |
|
|
|
B’s Capital A/c |
7,380 |
14,760 |
|
|
|
15,000 |
|
15,000 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Loan
As per the Partnership Act, if there is no partnership agreement regarding rate of interest on loan, it is provided at 6% p.a.
Amount of Loan = Rs 8,000
Time Period (from October 01 to March 31) = 6 months
WN 2 Calculation of Profit Share of each Partner
In the absence of partnership deed, profits of a firm are distributed equally among all the partners.
Profit after Interest on A’s loan = 15,000 − 240 = Rs 14,760
Page No 1.70:
Question 36:
Profit and Loss Account for the year ended March 31, 2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on A’s Loan |
240 |
Profit (before Interest) |
15,000 |
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
7,380 |
|
|
|
B’s Capital A/c |
7,380 |
14,760 |
|
|
|
15,000 |
|
15,000 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Loan
As per the Partnership Act, if there is no partnership agreement regarding rate of interest on loan, it is provided at 6% p.a.
Amount of Loan = Rs 8,000
Time Period (from October 01 to March 31) = 6 months
WN 2 Calculation of Profit Share of each Partner
In the absence of partnership deed, profits of a firm are distributed equally among all the partners.
Profit after Interest on A’s loan = 15,000 − 240 = Rs 14,760
Answer:
Profit and Loss Appropriation Account for the year ended 2013-2014 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
8,000 |
||
C |
600 |
|
|
|
|
D |
360 |
960 |
|
|
|
Salary to D (Rs 300 × 12) |
3,600 |
|
|
||
Profit transferred to : |
|
|
|
||
C’s Capital A/c |
1,720 |
|
|
|
|
D’s Capital A/c |
1,720 |
3,440 |
|
|
|
|
8,000 |
|
8,000 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = 8,000 − 960 − 3,600 = Rs 3,440
Total amount received by C = Interest on Capital + Profit Share = 600 + 1,720 = Rs 2,320
Total amount received by D = Interest on Capital + Salary + Profit Share = 360 + 3,600 + 1,720 = Rs 5,680
Page No 1.70:
Question 37:
Profit and Loss Appropriation Account for the year ended 2013-2014 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
8,000 |
||
C |
600 |
|
|
|
|
D |
360 |
960 |
|
|
|
Salary to D (Rs 300 × 12) |
3,600 |
|
|
||
Profit transferred to : |
|
|
|
||
C’s Capital A/c |
1,720 |
|
|
|
|
D’s Capital A/c |
1,720 |
3,440 |
|
|
|
|
8,000 |
|
8,000 |
||
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = 8,000 − 960 − 3,600 = Rs 3,440
Total amount received by C = Interest on Capital + Profit Share = 600 + 1,720 = Rs 2,320
Total amount received by D = Interest on Capital + Salary + Profit Share = 360 + 3,600 + 1,720 = Rs 5,680
Answer:
Profit and Loss Account for the year ended March 31,2014 |
|||
Dr. |
|
|
Cr. |
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Manager’s Commission |
750 |
Profit before B’s Salary |
15,000 |
(5% of Rs 15,000) |
|
(12,500+2,500) |
|
Profit transferred to Profit and Loss Appropriation Account |
14,250 |
|
|
|
15,000 |
|
15,000 |
|
|
|
|
Profit and Loss Appropriation Account for the year ended March 31,2012 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital A/c: |
|
Profit and Loss A/c |
14,250 |
||
A |
3,000 |
|
|
|
|
B |
1,800 |
4,800 |
|
|
|
B’s Salary |
2,500 |
|
|
||
Profit transferred to: |
|
|
|
||
A’s Capital A/c |
4,170 |
|
|
|
|
B’s Capital A/c |
2,780 |
6,950 |
|
|
|
|
14,250 |
|
14,250 |
||
|
|
|
|
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
A |
B |
Particulars |
A |
B |
|
Balance c/d |
57,170 |
37,080 |
Balance b/d |
50,000 |
30,000 |
|
|
|
|
Interest on Capital A/c |
3,000 |
1,800 |
|
|
|
|
Salary A/c |
|
2,500 |
|
|
|
|
P/L Appropriation A/c |
4,170 |
2,780 |
|
|
57,170 |
37,080 |
|
57,170 |
37,080 |
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Managers’ Commission
1. Managers’ Commission = 5% on Net Profit (before Salary)
Profit before Salary = Profit after Salary + Salary = 12,500 + 2500 = Rs 15,000
WN 2 Calculation of Interest on Capital
WN 3 Calculation of Profit Share of each Partner
Profit available for distribution = 12,500 − 750 − 3,000 − 1,800
= Rs 6,950
Profit sharing ratio = 3 : 2
Page No 1.70:
Question 38:
Profit and Loss Account for the year ended March 31,2014 |
|||
Dr. |
|
|
Cr. |
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Manager’s Commission |
750 |
Profit before B’s Salary |
15,000 |
(5% of Rs 15,000) |
|
(12,500+2,500) |
|
Profit transferred to Profit and Loss Appropriation Account |
14,250 |
|
|
|
15,000 |
|
15,000 |
|
|
|
|
Profit and Loss Appropriation Account for the year ended March 31,2012 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital A/c: |
|
Profit and Loss A/c |
14,250 |
||
A |
3,000 |
|
|
|
|
B |
1,800 |
4,800 |
|
|
|
B’s Salary |
2,500 |
|
|
||
Profit transferred to: |
|
|
|
||
A’s Capital A/c |
4,170 |
|
|
|
|
B’s Capital A/c |
2,780 |
6,950 |
|
|
|
|
14,250 |
|
14,250 |
||
|
|
|
|
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
A |
B |
Particulars |
A |
B |
|
Balance c/d |
57,170 |
37,080 |
Balance b/d |
50,000 |
30,000 |
|
|
|
|
Interest on Capital A/c |
3,000 |
1,800 |
|
|
|
|
Salary A/c |
|
2,500 |
|
|
|
|
P/L Appropriation A/c |
4,170 |
2,780 |
|
|
57,170 |
37,080 |
|
57,170 |
37,080 |
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Managers’ Commission
1. Managers’ Commission = 5% on Net Profit (before Salary)
Profit before Salary = Profit after Salary + Salary = 12,500 + 2500 = Rs 15,000
WN 2 Calculation of Interest on Capital
WN 3 Calculation of Profit Share of each Partner
Profit available for distribution = 12,500 − 750 − 3,000 − 1,800
= Rs 6,950
Profit sharing ratio = 3 : 2
Answer:
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
Sohan Rs |
Mohan Rs |
Particulars |
Sohan Rs |
Mohan Rs |
|
Drawings A/c |
50,000 |
30,000 |
Balance b/d |
4,00,000 |
3,00,000 |
|
Interest on Drawings A/c |
1,250 |
750 |
Interest on Capital A/c |
20,000 |
15,000 |
|
|
|
|
P/L Appropriation A/c |
60,000 |
50,000 |
|
Balance c/d |
4,69,750 |
3,37,250 |
Partners’ Salary |
36,000 |
- |
|
|
|
|
Commission |
5,000 |
3,000 |
|
|
5,21,000 |
3,68,000 |
|
5,21,000 |
3,68,000 |
|
|
|
|
|
|
|
Working Note:
Calculation of Interest on Capital
Page No 1.70:
Question 39:
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
Sohan Rs |
Mohan Rs |
Particulars |
Sohan Rs |
Mohan Rs |
|
Drawings A/c |
50,000 |
30,000 |
Balance b/d |
4,00,000 |
3,00,000 |
|
Interest on Drawings A/c |
1,250 |
750 |
Interest on Capital A/c |
20,000 |
15,000 |
|
|
|
|
P/L Appropriation A/c |
60,000 |
50,000 |
|
Balance c/d |
4,69,750 |
3,37,250 |
Partners’ Salary |
36,000 |
- |
|
|
|
|
Commission |
5,000 |
3,000 |
|
|
5,21,000 |
3,68,000 |
|
5,21,000 |
3,68,000 |
|
|
|
|
|
|
|
Working Note:
Calculation of Interest on Capital
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Interest on Capital A/c: |
|
Profit and Loss A/c (Net Profit) |
55,000 |
|||
Kalu |
2,500 |
|
|
|
||
Lalu |
1,500 |
4,000 |
Interest on Drawings A/c: |
|
||
Partners’ Salaries |
|
Kalu |
87.50 |
|
||
Kalu (Rs 500 × 12) |
6,000 |
|
Lalu |
60.00 |
147.50 |
|
Lalu (Rs 400 × 12) |
4,800 |
10,800 |
|
|
|
|
Profit transferred to: |
|
|
|
|||
Kalu’s Capital A/c |
24,208.50 |
|
|
|
||
Lalu’s Capital A/c |
16,139.00 |
40,347.50 |
|
|
||
|
55,147.50 |
|
55,147.50 |
|||
|
|
|
|
Partners’ Capital Accounts |
|||||
Cr. |
|
|
|
|
Dr. |
Particulars |
Kalu Rs |
Lalu Rs |
Particulars |
Kalu Rs |
Lalu Rs |
Drawings A/c |
3,500 |
2,400 |
Balance b/d |
50,000 |
30,000 |
Interest on Drawings A/c |
87.50 |
60 |
Interest on Capital A/c |
2,500 |
1,500 |
|
|
|
Partners’ Salary A/c |
6,000 |
4,800 |
Balance c/d |
79,121 |
49,979 |
P/L Appropriation A/c |
24,208.50 |
16,139 |
|
82,708.50 |
52,439 |
|
82,708.50 |
52,439 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
WN 3 Calculation of Profit Share of each Partner
Profit available for Distribution = 55,000 + 147.50 − 4,000 − 10,800
= Rs 40,347.50
Profit sharing ratio = 3 : 2
Page No 1.71:
Question 40:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Interest on Capital A/c: |
|
Profit and Loss A/c (Net Profit) |
55,000 |
|||
Kalu |
2,500 |
|
|
|
||
Lalu |
1,500 |
4,000 |
Interest on Drawings A/c: |
|
||
Partners’ Salaries |
|
Kalu |
87.50 |
|
||
Kalu (Rs 500 × 12) |
6,000 |
|
Lalu |
60.00 |
147.50 |
|
Lalu (Rs 400 × 12) |
4,800 |
10,800 |
|
|
|
|
Profit transferred to: |
|
|
|
|||
Kalu’s Capital A/c |
24,208.50 |
|
|
|
||
Lalu’s Capital A/c |
16,139.00 |
40,347.50 |
|
|
||
|
55,147.50 |
|
55,147.50 |
|||
|
|
|
|
Partners’ Capital Accounts |
|||||
Cr. |
|
|
|
|
Dr. |
Particulars |
Kalu Rs |
Lalu Rs |
Particulars |
Kalu Rs |
Lalu Rs |
Drawings A/c |
3,500 |
2,400 |
Balance b/d |
50,000 |
30,000 |
Interest on Drawings A/c |
87.50 |
60 |
Interest on Capital A/c |
2,500 |
1,500 |
|
|
|
Partners’ Salary A/c |
6,000 |
4,800 |
Balance c/d |
79,121 |
49,979 |
P/L Appropriation A/c |
24,208.50 |
16,139 |
|
82,708.50 |
52,439 |
|
82,708.50 |
52,439 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
WN 3 Calculation of Profit Share of each Partner
Profit available for Distribution = 55,000 + 147.50 − 4,000 − 10,800
= Rs 40,347.50
Profit sharing ratio = 3 : 2
Answer:
Profit and Loss Adjustment Account |
|||
Dr. |
|
|
Cr. |
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Interest on Kajal’s loan@ 6% p.a. |
1,800 |
Profit |
70,260 |
Profit transferred to P/L Appropriation A/c |
68,460 |
|
|
|
|
|
|
|
70,260 |
|
70,260 |
|
|
|
|
Profit and Loss Appropriation Account |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Interest on Capital A/c: |
|
Profit and Loss A/c |
68,460 |
|||
Sajal |
2,500 |
|
|
|
||
Kajal |
2,000 |
4,500 |
Interest on Drawings A/c: |
|
||
|
|
Sajal |
300 |
|
||
Reserve |
6,450 |
Kajal |
240 |
540 |
||
Profit transferred to: |
|
|
|
|||
Sajal’s Capital A/c |
38,700 |
|
|
|
||
Kajal’s Capital A/c |
19,350 |
58,050 |
|
|
||
|
69,000 |
|
69,000 |
|||
|
|
|
|
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
Sajal |
Kajal |
Particulars |
Sajal |
Kajal |
|
Drawings A/c |
10,000 |
8,000 |
Balance b/d |
50,000 |
40,000 |
|
Interest on Drawings A/c |
300 |
240 |
Interest on Capital A/c |
2,500 |
2,000 |
|
|
|
|
P/L Appropriation A/c |
38,700 |
19,350 |
|
Balance c/d |
80,900 |
53,110 |
|
|
|
|
|
91,200 |
61,350 |
|
91,200 |
61,350 |
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
WN 3 Calculation of Amount to be transferred to Reserve
Amount for Reserve = 10% of Divisible Profit
Divisible Profit = Profit + Interest on Drawings − Interest on Capital
= 68,460 + 540 − 4,500 = Rs 64,500
WN 4 Calculation of Profit Share of each Partner
Profit available for Distribution = 68,460 + 540 − 4,500 − 6,450
= Rs 58,050
Profit sharing ratio = 2 : 1
Page No 1.71:
Question 41:
Profit and Loss Adjustment Account |
|||
Dr. |
|
|
Cr. |
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Interest on Kajal’s loan@ 6% p.a. |
1,800 |
Profit |
70,260 |
Profit transferred to P/L Appropriation A/c |
68,460 |
|
|
|
|
|
|
|
70,260 |
|
70,260 |
|
|
|
|
Profit and Loss Appropriation Account |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Interest on Capital A/c: |
|
Profit and Loss A/c |
68,460 |
|||
Sajal |
2,500 |
|
|
|
||
Kajal |
2,000 |
4,500 |
Interest on Drawings A/c: |
|
||
|
|
Sajal |
300 |
|
||
Reserve |
6,450 |
Kajal |
240 |
540 |
||
Profit transferred to: |
|
|
|
|||
Sajal’s Capital A/c |
38,700 |
|
|
|
||
Kajal’s Capital A/c |
19,350 |
58,050 |
|
|
||
|
69,000 |
|
69,000 |
|||
|
|
|
|
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
Sajal |
Kajal |
Particulars |
Sajal |
Kajal |
|
Drawings A/c |
10,000 |
8,000 |
Balance b/d |
50,000 |
40,000 |
|
Interest on Drawings A/c |
300 |
240 |
Interest on Capital A/c |
2,500 |
2,000 |
|
|
|
|
P/L Appropriation A/c |
38,700 |
19,350 |
|
Balance c/d |
80,900 |
53,110 |
|
|
|
|
|
91,200 |
61,350 |
|
91,200 |
61,350 |
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
WN 3 Calculation of Amount to be transferred to Reserve
Amount for Reserve = 10% of Divisible Profit
Divisible Profit = Profit + Interest on Drawings − Interest on Capital
= 68,460 + 540 − 4,500 = Rs 64,500
WN 4 Calculation of Profit Share of each Partner
Profit available for Distribution = 68,460 + 540 − 4,500 − 6,450
= Rs 58,050
Profit sharing ratio = 2 : 1
Answer:
Profit and Loss Appropriation Account for the year March 31, 2014 |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Salary to B |
12,000 |
Profit and Loss A/c (Net Profit) |
35,000 |
|||
Interest on Capital: |
|
Interest on Drawings A/c: |
|
|||
A |
6,000 |
|
A |
150 |
|
|
B |
4,500 |
10,500 |
B |
210 |
360 |
|
Profit transferred to: |
|
|
|
|||
A’s Capital A/c |
7,716 |
|
|
|
||
B’s Capital A/c |
5,144 |
12,860 |
|
|
||
|
35,360 |
|
35,360 |
|||
|
|
|
|
Partners’ Capital Accounts |
|||||
Dr. |
|
|
|
|
Cr. |
Particulars |
A |
B |
Particulars |
A |
B |
Drawings A/c |
9,000 |
18,000 |
Balance b/d |
60,000 |
45,000 |
Interest on Drawings A/c |
150 |
210 |
Interest Capital A/c |
6,000 |
4,500 |
|
|
|
Salary A/c |
- |
12,000 |
Balance c/d |
64,566 |
48,434 |
P/L Appropriation A/c |
7,716 |
5,144 |
|
73,716 |
66,644 |
|
73,716 |
66,644 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for Distribution = 35,000 + 360 − 12,000 − 10,500
= Rs 12, 860
Page No 1.71:
Question 42:
Profit and Loss Appropriation Account for the year March 31, 2014 |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Salary to B |
12,000 |
Profit and Loss A/c (Net Profit) |
35,000 |
|||
Interest on Capital: |
|
Interest on Drawings A/c: |
|
|||
A |
6,000 |
|
A |
150 |
|
|
B |
4,500 |
10,500 |
B |
210 |
360 |
|
Profit transferred to: |
|
|
|
|||
A’s Capital A/c |
7,716 |
|
|
|
||
B’s Capital A/c |
5,144 |
12,860 |
|
|
||
|
35,360 |
|
35,360 |
|||
|
|
|
|
Partners’ Capital Accounts |
|||||
Dr. |
|
|
|
|
Cr. |
Particulars |
A |
B |
Particulars |
A |
B |
Drawings A/c |
9,000 |
18,000 |
Balance b/d |
60,000 |
45,000 |
Interest on Drawings A/c |
150 |
210 |
Interest Capital A/c |
6,000 |
4,500 |
|
|
|
Salary A/c |
- |
12,000 |
Balance c/d |
64,566 |
48,434 |
P/L Appropriation A/c |
7,716 |
5,144 |
|
73,716 |
66,644 |
|
73,716 |
66,644 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for Distribution = 35,000 + 360 − 12,000 − 10,500
= Rs 12, 860
Answer:
Profit and Loss Adjustment Account for the year ended March 31, 2014 |
|||
Dr. |
|
|
Cr. |
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Interest on Bimal’s Loan (50,000×6%) |
3,000 |
Profit and Loss (Net Profit) |
1,75,000 |
Profit transferred to P/L Appropriation A/c |
1,72,000 |
|
|
|
|
|
|
|
1,75,000 |
|
1,75,000 |
|
|
|
|
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Interest on Capital: |
|
Profit and Loss A/c |
1,72,000 |
|||
Amal |
2,500 |
|
(after Interest on loan) |
|
||
Bimal |
2,000 |
4,500 |
Interest on Drawings A/c: |
|
||
Profit transferred to: |
|
Amal |
450 |
|
||
Amal’s Capital A/c |
1,34,600 |
|
Bimal |
300 |
750 |
|
Bimal’s Capital A/c |
33,650 |
1,68,250 |
|
|
||
|
1,72,750 |
|
1,72,750 |
|||
|
|
|
|
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
Amal Rs |
Bimal Rs |
Particulars |
Amal Rs |
Bimal Rs |
|
Drawings A/c |
15,000 |
10,000 |
Balance b/d |
50,000 |
40,000 |
|
Interest on Drawings A/c |
450 |
300 |
Interest on Capital A/c |
2,500 |
2,000 |
|
Balance c/d |
1,71,650 |
65,350 |
P/L Appropriation A/c |
1,34,600 |
33,650 |
|
|
1,87,100 |
75,650 |
|
1,87,100 |
75,650 |
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
WN 3 Calculation of Profit Share of each Partner
Profit available for distribution = 1,72,000 + 750 − 4,500 = Rs 1,68,250
Profit sharing ratio = 4 : 1
Page No 1.71:
Question 43:
Profit and Loss Adjustment Account for the year ended March 31, 2014 |
|||
Dr. |
|
|
Cr. |
Particulars |
Amount Rs |
Particulars |
Amount Rs |
Interest on Bimal’s Loan (50,000×6%) |
3,000 |
Profit and Loss (Net Profit) |
1,75,000 |
Profit transferred to P/L Appropriation A/c |
1,72,000 |
|
|
|
|
|
|
|
1,75,000 |
|
1,75,000 |
|
|
|
|
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Interest on Capital: |
|
Profit and Loss A/c |
1,72,000 |
|||
Amal |
2,500 |
|
(after Interest on loan) |
|
||
Bimal |
2,000 |
4,500 |
Interest on Drawings A/c: |
|
||
Profit transferred to: |
|
Amal |
450 |
|
||
Amal’s Capital A/c |
1,34,600 |
|
Bimal |
300 |
750 |
|
Bimal’s Capital A/c |
33,650 |
1,68,250 |
|
|
||
|
1,72,750 |
|
1,72,750 |
|||
|
|
|
|
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
Amal Rs |
Bimal Rs |
Particulars |
Amal Rs |
Bimal Rs |
|
Drawings A/c |
15,000 |
10,000 |
Balance b/d |
50,000 |
40,000 |
|
Interest on Drawings A/c |
450 |
300 |
Interest on Capital A/c |
2,500 |
2,000 |
|
Balance c/d |
1,71,650 |
65,350 |
P/L Appropriation A/c |
1,34,600 |
33,650 |
|
|
1,87,100 |
75,650 |
|
1,87,100 |
75,650 |
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
WN 3 Calculation of Profit Share of each Partner
Profit available for distribution = 1,72,000 + 750 − 4,500 = Rs 1,68,250
Profit sharing ratio = 4 : 1
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
|||||
Dr. |
Cr. |
||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Salary to A (Rs 500 × 12) |
6,000 |
Profit and Loss A/c |
50,000 |
||
Interest on Capital: |
|
|
|
||
A |
3,000 |
|
|
|
|
B |
4,500 |
7,500 |
|
|
|
Profit transferred to : |
|
|
|
||
A’s Capital A/c |
18,250 |
|
|
|
|
B’s Capital A/c |
18,250 |
36,500 |
|
|
|
|
50,000 |
|
50,000 |
||
|
|
|
|
Partners’ Capital Accounts |
|||||
Dr. |
|
|
|
|
Cr. |
Particulars |
A |
B |
Particulars |
A |
B |
Drawings A/c |
15,000 |
20,000 |
Balance b/d |
50,000 |
1,00,000 |
|
|
|
Salary A/c |
6,000 |
- |
|
|
|
Interest on Capital A/c |
3,000 |
4,500 |
Balance c/d |
62,250 |
1,02,750 |
P/L Appropriation A/c |
18,250 |
18,250 |
|
77,250 |
1,22,750 |
|
77,250 |
1,22,750 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = Rs 50,000 − 6,000 − 7,500 = 36,500
Page No 1.71:
Question 44:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
|||||
Dr. |
Cr. |
||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Salary to A (Rs 500 × 12) |
6,000 |
Profit and Loss A/c |
50,000 |
||
Interest on Capital: |
|
|
|
||
A |
3,000 |
|
|
|
|
B |
4,500 |
7,500 |
|
|
|
Profit transferred to : |
|
|
|
||
A’s Capital A/c |
18,250 |
|
|
|
|
B’s Capital A/c |
18,250 |
36,500 |
|
|
|
|
50,000 |
|
50,000 |
||
|
|
|
|
Partners’ Capital Accounts |
|||||
Dr. |
|
|
|
|
Cr. |
Particulars |
A |
B |
Particulars |
A |
B |
Drawings A/c |
15,000 |
20,000 |
Balance b/d |
50,000 |
1,00,000 |
|
|
|
Salary A/c |
6,000 |
- |
|
|
|
Interest on Capital A/c |
3,000 |
4,500 |
Balance c/d |
62,250 |
1,02,750 |
P/L Appropriation A/c |
18,250 |
18,250 |
|
77,250 |
1,22,750 |
|
77,250 |
1,22,750 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = Rs 50,000 − 6,000 − 7,500 = 36,500
Answer:
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
Ali Rs |
Bahadur Rs |
Particulars |
Ali Rs |
Bahadur Rs |
|
|
|
|
Balance b/d |
25,000 |
20,000 |
|
Balance c/d |
25,000 |
20,000 |
|
|
|
|
|
25,000 |
20,000 |
|
25,000 |
20,000 |
|
|
|
|
|
|
|
Partners’ Current Accounts |
|||||
Dr. |
|
Cr. |
|||
Particulars |
Ali Rs |
Bahadur Rs |
Particulars |
Ali Rs |
Bahadur Rs |
Drawings A/c |
3,500 |
2,500 |
Interest on Capital A/c |
1,250 |
1,000 |
|
|
|
Bahadur’s Salary A/c |
|
3,000 |
Balance c/d |
19,275 |
10,725 |
P/L Appropriation A/c |
21,525 |
9,225 |
|
22,775 |
13,225 |
|
22,775 |
13,225 |
|
|
|
|
|
|
Working Notes:
WN 1
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c |
40,000 |
||
Ali |
1,250 |
|
|
|
|
Bahadur |
1,000 |
2,250 |
|
|
|
Reserve |
4,000 |
|
|
||
Bahadur’s Salary |
3,000 |
|
|
||
Profit transferred to: |
|
|
|
||
Ali’s Capital A/c |
21,525 |
|
|
|
|
Bahadur’s Capital A/c |
9,225 |
30,750 |
|
|
|
|
40,000 |
|
40,000 |
||
|
|
|
|
WN 2 Calculation of Interest on Capital
WN 3 Calculation of Amount to be transferred to Reserve
WN 4 Calculation of Profit Share of each Partner
Profit available for distribution = 40,000 − 2,250 − 4,000 − 3,000 = Rs 30,750
Page No 1.71:
Question 45:
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
Ali Rs |
Bahadur Rs |
Particulars |
Ali Rs |
Bahadur Rs |
|
|
|
|
Balance b/d |
25,000 |
20,000 |
|
Balance c/d |
25,000 |
20,000 |
|
|
|
|
|
25,000 |
20,000 |
|
25,000 |
20,000 |
|
|
|
|
|
|
|
Partners’ Current Accounts |
|||||
Dr. |
|
Cr. |
|||
Particulars |
Ali Rs |
Bahadur Rs |
Particulars |
Ali Rs |
Bahadur Rs |
Drawings A/c |
3,500 |
2,500 |
Interest on Capital A/c |
1,250 |
1,000 |
|
|
|
Bahadur’s Salary A/c |
|
3,000 |
Balance c/d |
19,275 |
10,725 |
P/L Appropriation A/c |
21,525 |
9,225 |
|
22,775 |
13,225 |
|
22,775 |
13,225 |
|
|
|
|
|
|
Working Notes:
WN 1
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c |
40,000 |
||
Ali |
1,250 |
|
|
|
|
Bahadur |
1,000 |
2,250 |
|
|
|
Reserve |
4,000 |
|
|
||
Bahadur’s Salary |
3,000 |
|
|
||
Profit transferred to: |
|
|
|
||
Ali’s Capital A/c |
21,525 |
|
|
|
|
Bahadur’s Capital A/c |
9,225 |
30,750 |
|
|
|
|
40,000 |
|
40,000 |
||
|
|
|
|
WN 2 Calculation of Interest on Capital
WN 3 Calculation of Amount to be transferred to Reserve
WN 4 Calculation of Profit Share of each Partner
Profit available for distribution = 40,000 − 2,250 − 4,000 − 3,000 = Rs 30,750
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
|||||
Dr. | Cr. | ||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit (after Salary) |
21,000 |
||
P |
2,000 |
|
|
|
|
Q |
1,500 |
|
|
|
|
R |
1,500 |
5,000 |
|
|
|
Profit transferred to: |
|
|
|
||
P’s Capital A/c |
7,000 |
|
|
|
|
Q’s Capital A/c |
5,000 |
|
|
|
|
R’s Capital A/c |
4,000 |
16,000 |
|
|
|
|
21,000 |
|
21,000 |
||
|
|
|
|
Partners’ Capital Accounts |
|||||||
Dr. |
|
|
|
|
|
|
Cr. |
Particulars |
P |
Q |
R |
Particulars |
P |
Q |
R |
Drawings A/c |
10,000 |
10,000 |
10,000 |
Balance b/d |
40,000 |
30,000 |
30,000 |
|
|
|
|
Salaries A/c |
- |
6,000 |
4,000 |
|
|
|
|
Interest Capital A/c |
2,000 |
1,500 |
1,500 |
Balance c/d |
39,000 |
32,500 |
29,500 |
P/L Appropriation A/c |
7,000 |
5,000 |
4,000 |
|
49,000 |
32,500 |
29,500 |
|
49,000 |
42,500 |
39,500 |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = 21,000 − 5000 = Rs 16,000
- Distribution of first Rs 10,000 (50%, 30% and 20%)
- Distribution of Reaming Profit i.e. Rs 6,000 (16,000 − 10,000) equally
Therefore,
Page No 1.72:
Question 46:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
|||||
Dr. | Cr. | ||||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit (after Salary) |
21,000 |
||
P |
2,000 |
|
|
|
|
Q |
1,500 |
|
|
|
|
R |
1,500 |
5,000 |
|
|
|
Profit transferred to: |
|
|
|
||
P’s Capital A/c |
7,000 |
|
|
|
|
Q’s Capital A/c |
5,000 |
|
|
|
|
R’s Capital A/c |
4,000 |
16,000 |
|
|
|
|
21,000 |
|
21,000 |
||
|
|
|
|
Partners’ Capital Accounts |
|||||||
Dr. |
|
|
|
|
|
|
Cr. |
Particulars |
P |
Q |
R |
Particulars |
P |
Q |
R |
Drawings A/c |
10,000 |
10,000 |
10,000 |
Balance b/d |
40,000 |
30,000 |
30,000 |
|
|
|
|
Salaries A/c |
- |
6,000 |
4,000 |
|
|
|
|
Interest Capital A/c |
2,000 |
1,500 |
1,500 |
Balance c/d |
39,000 |
32,500 |
29,500 |
P/L Appropriation A/c |
7,000 |
5,000 |
4,000 |
|
49,000 |
32,500 |
29,500 |
|
49,000 |
42,500 |
39,500 |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for distribution = 21,000 − 5000 = Rs 16,000
- Distribution of first Rs 10,000 (50%, 30% and 20%)
- Distribution of Reaming Profit i.e. Rs 6,000 (16,000 − 10,000) equally
Therefore,
Answer:
Profit and Loss Appropriation Account |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Interest on Capital: |
|
Profit and Loss A/c |
45,000 |
|||
A |
2,500 |
|
|
|
||
B |
1,500 |
|
|
|
||
C |
1,000 |
5,000 |
|
|
||
Salary to: |
|
|
|
|||
B |
5,000 |
|
|
|
||
C |
5,000 |
10,000 |
|
|
||
Profit transferred to: |
|
|
|
|||
A’s Current A/c |
15,000 |
|
|
|
||
B’s Current A/c |
9,000 |
|
|
|
||
C’s Current A/c |
6,000 |
30,000 |
|
|
||
|
45,000 |
|
45,000 |
|||
|
|
|
|
Partners’ Capital Accounts |
|||||||
Dr. |
|
|
|
|
|
|
Cr. |
Particulars |
A |
B |
C |
Particulars |
A |
B |
C |
|
|
|
|
Balance b/d |
50,000 |
30,000 |
20,000 |
Balance c/d |
50,000 |
30,000 |
20,000 |
|
|
|
|
|
50,000 |
30,000 |
20,000 |
|
50,000 |
30,000 |
20,000 |
|
|
|
|
|
|
|
|
Partners’ Current Accounts |
|||||||
Dr. |
|
|
|
|
|
|
Cr. |
Particulars |
A |
B |
C |
Particulars |
A |
B |
C |
Drawings A/c |
10,000 |
7,500 |
6,000 |
Balance b/d |
4,500 |
1,500 |
1,000 |
|
|
|
|
Interest on Capital A/c |
2,500 |
1,500 |
1,000 |
|
|
|
|
Salaries A/c |
|
5,000 |
5,000 |
Balance c/d |
12,000 |
9,500 |
7,000 |
P/L Appropriation A/c |
15,000 |
9,000 |
6,000 |
|
22,000 |
17,000 |
13,000 |
|
22,000 |
17,000 |
13,000 |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for Distribution = 45,000 − 15,000 = Rs 30,000
Page No 1.72:
Question 47:
Profit and Loss Appropriation Account |
||||||
Dr. |
|
|
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|||
Interest on Capital: |
|
Profit and Loss A/c |
45,000 |
|||
A |
2,500 |
|
|
|
||
B |
1,500 |
|
|
|
||
C |
1,000 |
5,000 |
|
|
||
Salary to: |
|
|
|
|||
B |
5,000 |
|
|
|
||
C |
5,000 |
10,000 |
|
|
||
Profit transferred to: |
|
|
|
|||
A’s Current A/c |
15,000 |
|
|
|
||
B’s Current A/c |
9,000 |
|
|
|
||
C’s Current A/c |
6,000 |
30,000 |
|
|
||
|
45,000 |
|
45,000 |
|||
|
|
|
|
Partners’ Capital Accounts |
|||||||
Dr. |
|
|
|
|
|
|
Cr. |
Particulars |
A |
B |
C |
Particulars |
A |
B |
C |
|
|
|
|
Balance b/d |
50,000 |
30,000 |
20,000 |
Balance c/d |
50,000 |
30,000 |
20,000 |
|
|
|
|
|
50,000 |
30,000 |
20,000 |
|
50,000 |
30,000 |
20,000 |
|
|
|
|
|
|
|
|
Partners’ Current Accounts |
|||||||
Dr. |
|
|
|
|
|
|
Cr. |
Particulars |
A |
B |
C |
Particulars |
A |
B |
C |
Drawings A/c |
10,000 |
7,500 |
6,000 |
Balance b/d |
4,500 |
1,500 |
1,000 |
|
|
|
|
Interest on Capital A/c |
2,500 |
1,500 |
1,000 |
|
|
|
|
Salaries A/c |
|
5,000 |
5,000 |
Balance c/d |
12,000 |
9,500 |
7,000 |
P/L Appropriation A/c |
15,000 |
9,000 |
6,000 |
|
22,000 |
17,000 |
13,000 |
|
22,000 |
17,000 |
13,000 |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit Share of each Partner
Profit available for Distribution = 45,000 − 15,000 = Rs 30,000
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
50,000 |
|
A |
3,000 |
|
|
|
B |
1,800 |
4,800 |
|
|
B’s Salary (500 × 12) |
6,000 |
|
|
|
Partner’s Commission |
|
|
|
|
A |
6,000 |
|
|
|
B |
1,581 |
7,581 |
|
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
23,714 |
|
|
|
B’s Capital A/c |
7,905 |
31,619 |
|
|
|
50,000 |
|
50,000 |
|
|
|
|
|
Partners’ Capital Accounts |
|||||
Dr. |
|
|
|
|
Cr. |
Particulars |
A |
B |
Particulars |
A |
B |
Drawings A/c |
8,000 |
6,000 |
Balance b/d |
50,000 |
30,000 |
|
|
|
Interest on Capital A/c |
3,000 |
1,800 |
|
|
|
Commission A/c |
6,000 |
1,581 |
|
|
|
Salary A/c |
|
6,000 |
Balance c/d |
74,714 |
41,286 |
P/L Appropriation A/c |
23,714 |
7,905 |
|
82,714 |
47,286 |
|
82,714 |
47,286 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Commission to Partners
Commission to B = 5% on Profits after all Expense including such Commission
Profits after all expense = 50,000 − 4,800 − 6,000 − 6,000 = Rs 33,200
WN 3 Calculation of Profit Share of each Partner
Profit available for Distribution = 50,000 − 4,800 − 6,000 −7,581
= Rs 31,619
Profit sharing ratio = 3 : 1
Page No 1.72:
Question 48:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
50,000 |
|
A |
3,000 |
|
|
|
B |
1,800 |
4,800 |
|
|
B’s Salary (500 × 12) |
6,000 |
|
|
|
Partner’s Commission |
|
|
|
|
A |
6,000 |
|
|
|
B |
1,581 |
7,581 |
|
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
23,714 |
|
|
|
B’s Capital A/c |
7,905 |
31,619 |
|
|
|
50,000 |
|
50,000 |
|
|
|
|
|
Partners’ Capital Accounts |
|||||
Dr. |
|
|
|
|
Cr. |
Particulars |
A |
B |
Particulars |
A |
B |
Drawings A/c |
8,000 |
6,000 |
Balance b/d |
50,000 |
30,000 |
|
|
|
Interest on Capital A/c |
3,000 |
1,800 |
|
|
|
Commission A/c |
6,000 |
1,581 |
|
|
|
Salary A/c |
|
6,000 |
Balance c/d |
74,714 |
41,286 |
P/L Appropriation A/c |
23,714 |
7,905 |
|
82,714 |
47,286 |
|
82,714 |
47,286 |
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Commission to Partners
Commission to B = 5% on Profits after all Expense including such Commission
Profits after all expense = 50,000 − 4,800 − 6,000 − 6,000 = Rs 33,200
WN 3 Calculation of Profit Share of each Partner
Profit available for Distribution = 50,000 − 4,800 − 6,000 −7,581
= Rs 31,619
Profit sharing ratio = 3 : 1
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
33,360 |
||
Amal |
2,000 |
|
|
|
|
Bimal |
1,500 |
|
|
|
|
Kamal |
1,250 |
4,750 |
|
|
|
Salary to Amal (Rs 250 × 12) |
3,000 |
|
|
||
Commission to Bimal |
985 |
|
|
||
General Reserve |
2,462 |
|
|
||
Profit transferred to: |
|
|
|
||
Amal’s Capital A/c |
7,388 |
|
|
|
|
Bimal’s Capital A/c |
7,388 |
|
|
|
|
Kamal’s Capital A/c |
7,387 |
22,163 |
|
|
|
|
33,360 |
|
33,360 |
||
|
|
|
|
Partners’ Capital Accounts |
||||||||
Dr. |
Cr. |
|||||||
Particulars |
Amal Rs |
Bimal Rs |
Kamal Rs |
Particulars |
Amal Rs |
Bimal Rs |
Kamal Rs |
|
|
|
|
|
Balance b/d |
40,000 |
30,000 |
25,000 |
|
|
|
|
|
Interest on Capital A/c |
2,000 |
1,500 |
1,250 |
|
|
|
|
|
Salary A/c |
3,000 |
- |
- |
|
|
|
|
|
Commission |
- |
985 |
- |
|
Balance c/d |
52,388 |
39,873 |
33,637 |
P/L Appropriation A/c |
7,388 |
7,388 |
7,387 |
|
|
52,388 |
39,873 |
33,637 |
|
52,388 |
39,873 |
33,637 |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Commission to Bimal
Commission to Bimal = 4% on Net Profits after Commission
Profit after expenses = 33,360 − 4,750 − 3,000 = Rs 25,610
WN 3 Calculation of Amount to be transferred to General Reserve
Amount for General Reserve = 10% of Profit
WN 4 Calculation of Profit Share of each Partner
Profit available for Distribution = 33,360 − 4,750 − 3,000− 985 − 2,462
= Rs 22,163
Page No 1.72:
Question 49:
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
Interest on Capital: |
|
Profit and Loss A/c (Net Profit) |
33,360 |
||
Amal |
2,000 |
|
|
|
|
Bimal |
1,500 |
|
|
|
|
Kamal |
1,250 |
4,750 |
|
|
|
Salary to Amal (Rs 250 × 12) |
3,000 |
|
|
||
Commission to Bimal |
985 |
|
|
||
General Reserve |
2,462 |
|
|
||
Profit transferred to: |
|
|
|
||
Amal’s Capital A/c |
7,388 |
|
|
|
|
Bimal’s Capital A/c |
7,388 |
|
|
|
|
Kamal’s Capital A/c |
7,387 |
22,163 |
|
|
|
|
33,360 |
|
33,360 |
||
|
|
|
|
Partners’ Capital Accounts |
||||||||
Dr. |
Cr. |
|||||||
Particulars |
Amal Rs |
Bimal Rs |
Kamal Rs |
Particulars |
Amal Rs |
Bimal Rs |
Kamal Rs |
|
|
|
|
|
Balance b/d |
40,000 |
30,000 |
25,000 |
|
|
|
|
|
Interest on Capital A/c |
2,000 |
1,500 |
1,250 |
|
|
|
|
|
Salary A/c |
3,000 |
- |
- |
|
|
|
|
|
Commission |
- |
985 |
- |
|
Balance c/d |
52,388 |
39,873 |
33,637 |
P/L Appropriation A/c |
7,388 |
7,388 |
7,387 |
|
|
52,388 |
39,873 |
33,637 |
|
52,388 |
39,873 |
33,637 |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Commission to Bimal
Commission to Bimal = 4% on Net Profits after Commission
Profit after expenses = 33,360 − 4,750 − 3,000 = Rs 25,610
WN 3 Calculation of Amount to be transferred to General Reserve
Amount for General Reserve = 10% of Profit
WN 4 Calculation of Profit Share of each Partner
Profit available for Distribution = 33,360 − 4,750 − 3,000− 985 − 2,462
= Rs 22,163
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||
Dr. |
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Anshul’s Capital |
20,000 |
Profit and Loss A/c |
32,000 |
|
Asha’s Salary |
12,000 |
|
|
|
|
32,000 |
|
32,000 |
|
|
|
|
|
Working Note:
Salary to Asha = Rs 24,000
Total appropriation to be made = 40,000 + 24,000 = Rs 64,000
Profit earned during the year = 32,000
Here, profit available for distribution (i.e. Rs 32,000) is less than the sum total of Interest on Capital and Salary (i.e. Rs 64,000).
Therefore, profit will be distributed in the ratio of Interest on Capital and Salary.
Page No 1.72:
Question 50:
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||
Dr. |
Cr. |
|||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Interest on Anshul’s Capital |
20,000 |
Profit and Loss A/c |
32,000 |
|
Asha’s Salary |
12,000 |
|
|
|
|
32,000 |
|
32,000 |
|
|
|
|
|
Working Note:
Salary to Asha = Rs 24,000
Total appropriation to be made = 40,000 + 24,000 = Rs 64,000
Profit earned during the year = 32,000
Here, profit available for distribution (i.e. Rs 32,000) is less than the sum total of Interest on Capital and Salary (i.e. Rs 64,000).
Therefore, profit will be distributed in the ratio of Interest on Capital and Salary.
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2010 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
General Reserve |
20,000 |
Profit and Loss A/c |
75,500 |
||
Interest on Capital A/c: |
|
Interest on Drawings A/c: |
|
||
Ripa |
4,000 |
|
Ripa |
455 |
|
Rini |
3,200 |
|
Rini |
390 |
|
Rima |
2,800 |
10,000 |
Rima |
325 |
1,170 |
Salary to: |
|
|
|
||
Rini |
3,000 |
|
|
|
|
Rima |
4,500 |
7,500 |
|
|
|
Commission to Ripa |
3,561 |
|
|
||
Profit transferred to: |
|
|
|
||
Ripa’s Capital A/c |
11,870 |
|
|
|
|
Rini’s Capital A/c |
11,870 |
|
|
|
|
Rima’s Capital A/c |
11,869 |
35,609 |
|
|
|
|
76,670 |
|
76,670 |
||
|
|
|
|
Partners’ Capital Accounts |
||||||||
Dr. |
Cr. |
|||||||
Particulars |
Ripa Rs |
Rini Rs |
Rima Rs |
Particulars |
Ripa Rs |
Rini Rs |
Rima Rs |
|
Drawings A/c |
8,400 |
7,200 |
6,000 |
Balance b/d |
50,000 |
40,000 |
35,000 |
|
Interest on Drawings |
455 |
390 |
325 |
Interest on Capital A/c |
4,000 |
3,200 |
2,800 |
|
|
|
|
|
Salary A/c |
- |
3,000 |
4,500 |
|
Balance c/d |
60,576 |
50,480 |
47,844 |
Commission A/c |
3,561 |
- |
- |
|
|
|
|
|
P/L Appropriation A/c |
11,870 |
11,870 |
11,869 |
|
|
69,431 |
58,070 |
54,169 |
|
69,431 |
58,070 |
54,169 |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
WN 3 Calculation of Commission to Ripa
Commission to Ripa = 10% on Net Distributable Profit after charging such Commission
Net Distributable Profit = 75,500 + 1,170 − 20,000 − 10,000 − 7,500
= Rs 39,170
WN 4 Calculation of Profit Share of each Partner
Profit available for Distribution = 39,170 − 3561 = Rs 35,609
Page No 1.73:
Question 51:
Profit and Loss Appropriation Account for the year ended March 31, 2010 |
|||||
Dr. |
|
|
Cr. |
||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
||
General Reserve |
20,000 |
Profit and Loss A/c |
75,500 |
||
Interest on Capital A/c: |
|
Interest on Drawings A/c: |
|
||
Ripa |
4,000 |
|
Ripa |
455 |
|
Rini |
3,200 |
|
Rini |
390 |
|
Rima |
2,800 |
10,000 |
Rima |
325 |
1,170 |
Salary to: |
|
|
|
||
Rini |
3,000 |
|
|
|
|
Rima |
4,500 |
7,500 |
|
|
|
Commission to Ripa |
3,561 |
|
|
||
Profit transferred to: |
|
|
|
||
Ripa’s Capital A/c |
11,870 |
|
|
|
|
Rini’s Capital A/c |
11,870 |
|
|
|
|
Rima’s Capital A/c |
11,869 |
35,609 |
|
|
|
|
76,670 |
|
76,670 |
||
|
|
|
|
Partners’ Capital Accounts |
||||||||
Dr. |
Cr. |
|||||||
Particulars |
Ripa Rs |
Rini Rs |
Rima Rs |
Particulars |
Ripa Rs |
Rini Rs |
Rima Rs |
|
Drawings A/c |
8,400 |
7,200 |
6,000 |
Balance b/d |
50,000 |
40,000 |
35,000 |
|
Interest on Drawings |
455 |
390 |
325 |
Interest on Capital A/c |
4,000 |
3,200 |
2,800 |
|
|
|
|
|
Salary A/c |
- |
3,000 |
4,500 |
|
Balance c/d |
60,576 |
50,480 |
47,844 |
Commission A/c |
3,561 |
- |
- |
|
|
|
|
|
P/L Appropriation A/c |
11,870 |
11,870 |
11,869 |
|
|
69,431 |
58,070 |
54,169 |
|
69,431 |
58,070 |
54,169 |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Interest on Drawings
WN 3 Calculation of Commission to Ripa
Commission to Ripa = 10% on Net Distributable Profit after charging such Commission
Net Distributable Profit = 75,500 + 1,170 − 20,000 − 10,000 − 7,500
= Rs 39,170
WN 4 Calculation of Profit Share of each Partner
Profit available for Distribution = 39,170 − 3561 = Rs 35,609
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Donation to Red Cross Society (12,00,000×5%) |
60,000 |
Profit and Loss A/c (Net Profit) |
12,00,000 |
|
Donation to Prime Minister Relief Fund (12,00,000×10%) |
1,20,000 |
|
|
|
Profit transferred to: |
|
|
|
|
Sita |
3,40,000 |
|
|
|
Geeta |
3,40,000 |
|
|
|
Neha |
3,40,000 |
10,20,000 |
|
|
|
|
12,00,000 |
|
12,00,000 |
|
|
The four values that should be kept in mind by the three partners while preparing Partnership Deed are
- Equality and Equity;
- Social Welfare;
- Mutual Trust and Honesty
- Integration of individual efforts to achieve common goals
Page No 1.73:
Question 52:
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Donation to Red Cross Society (12,00,000×5%) |
60,000 |
Profit and Loss A/c (Net Profit) |
12,00,000 |
|
Donation to Prime Minister Relief Fund (12,00,000×10%) |
1,20,000 |
|
|
|
Profit transferred to: |
|
|
|
|
Sita |
3,40,000 |
|
|
|
Geeta |
3,40,000 |
|
|
|
Neha |
3,40,000 |
10,20,000 |
|
|
|
|
12,00,000 |
|
12,00,000 |
|
|
The four values that should be kept in mind by the three partners while preparing Partnership Deed are
- Equality and Equity;
- Social Welfare;
- Mutual Trust and Honesty
- Integration of individual efforts to achieve common goals
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Nisha’s Capital A/c |
Dr. |
|
55,000 |
|
To Reya’s Capital A/c |
|
|
55,000 |
|
(Adjustment of profit made) |
|
|
|
|
|
|
|
|
Working Note:
Total Profits for Last 3 years = 1,40,000 + 84,000 + 1,06,000 = Rs 3,30,000
Statement Showing Adjustment |
||||
Particulars |
Reya |
Mona |
Nisha |
Total |
Right Distribution of Profit (3 : 2 :1) |
1,65,000 |
1,10,000 |
55,000 |
3,30,000 |
Wrong Distribution of Profit (1: 1 : 1) |
(1,10,000) |
(1,10,000) |
(1,10,000) |
(3,30,000) |
Net Effect |
55,000 |
NIL |
(55,000) |
NIL |
|
|
|
|
|
Page No 1.73:
Question 53:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Nisha’s Capital A/c |
Dr. |
|
55,000 |
|
To Reya’s Capital A/c |
|
|
55,000 |
|
(Adjustment of profit made) |
|
|
|
|
|
|
|
|
Working Note:
Total Profits for Last 3 years = 1,40,000 + 84,000 + 1,06,000 = Rs 3,30,000
Statement Showing Adjustment |
||||
Particulars |
Reya |
Mona |
Nisha |
Total |
Right Distribution of Profit (3 : 2 :1) |
1,65,000 |
1,10,000 |
55,000 |
3,30,000 |
Wrong Distribution of Profit (1: 1 : 1) |
(1,10,000) |
(1,10,000) |
(1,10,000) |
(3,30,000) |
Net Effect |
55,000 |
NIL |
(55,000) |
NIL |
|
|
|
|
|
Answer:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
Anu’s Capital A/c |
Dr. |
|
1,000 |
|
|
To Pankaj’s Capital A/c |
|
|
1,000 |
|
|
(Adjustment of omission of Interest on Capital) |
|
|
|
|
|
|
|
|
|
Working Note:
Statement Showing Adjustment |
|||
Particulars |
Pankaj |
Anu |
Total |
Interest on Capital to be credited |
3,000 |
1,000 |
4,000 |
Profit wrongly distributed equally to be debited |
(2,000) |
(2,000) |
(4,000) |
Net Effect |
1,000 (Cr.) |
1,000 (Dr.) |
NIL |
|
|
|
|
Page No 1.73:
Question 54:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
Anu’s Capital A/c |
Dr. |
|
1,000 |
|
|
To Pankaj’s Capital A/c |
|
|
1,000 |
|
|
(Adjustment of omission of Interest on Capital) |
|
|
|
|
|
|
|
|
|
Working Note:
Statement Showing Adjustment |
|||
Particulars |
Pankaj |
Anu |
Total |
Interest on Capital to be credited |
3,000 |
1,000 |
4,000 |
Profit wrongly distributed equally to be debited |
(2,000) |
(2,000) |
(4,000) |
Net Effect |
1,000 (Cr.) |
1,000 (Dr.) |
NIL |
|
|
|
|
Answer:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
Ram’s Capital A/c |
Dr. |
|
100 |
|
|
To Mohan’s Capital A/c |
|
|
100 |
|
|
(Interest on Capital was omitted, now adjusted) |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
Particulars |
Ram |
Mohan |
Total |
Interest on Capital to be credited |
200 |
400 |
600 |
For sharing above Loss (1:1) |
(300) |
(300) |
(600) |
Net Effect |
(100) |
(100) |
Nil |
(Dr.) |
(Cr.) |
||
|
|
Page No 1.73:
Question 55:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
Ram’s Capital A/c |
Dr. |
|
100 |
|
|
To Mohan’s Capital A/c |
|
|
100 |
|
|
(Interest on Capital was omitted, now adjusted) |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
Particulars |
Ram |
Mohan |
Total |
Interest on Capital to be credited |
200 |
400 |
600 |
For sharing above Loss (1:1) |
(300) |
(300) |
(600) |
Net Effect |
(100) |
(100) |
Nil |
(Dr.) |
(Cr.) |
||
|
|
Answer:
Journal |
|||||
Date |
Particulars |
L. F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
A’s Capital A/c |
Dr. |
|
1,210 |
|
|
To B’s Capital A/c |
|
|
1,210 |
|
|
(Amount of interest on Capital and interest on drawings adjusted) |
|
|
|
|
|
|
|
|
|
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
A |
B |
Particulars |
A |
B |
|
B’s Capital A/c |
1,210 |
|
Balance b/d |
4,00,000 |
3,00,000 |
|
|
|
|
A’s Capital A/c |
- |
1,210 |
|
Balance c/d |
3,98,790 |
3,01,210 |
|
|
|
|
|
4,00,000 |
3,01,210 |
|
4,00,000 |
3,01,210 |
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Capital as on April 01, 2014 (Opening Capital)
Particulars |
A |
B |
Total |
Capital as on March 31, 2015 (Closing) |
4,00,000 |
3,00,000 |
7,00,000 |
Add: Drawings |
48,000 |
36,000 |
84,000 |
Less: Profit (3:2) |
(1,20,000) |
(80,000) |
(2,00,000) |
Capital as on April 01, 2014 (Opening) |
3,28,000 |
2,56,000 |
5,84,000 |
|
|
|
|
WN 2 Calculation on Interest on Capital
WN 3 Calculation of Interest on Drawings
WN 4
Statement Showing Adjustment |
|||
Particulars |
A |
B |
Total |
Interest on Capital (to be credited) |
16,400 |
12,800 |
29,200 |
Less: Interest on Drawings |
(900) |
(450) |
(1,350) |
Right distribution of Rs 27,850 |
15,500 |
12,350 |
27,850 |
Less: Wrong Distribution of Rs 27,850 (3:2) |
(16,710) |
(11,140) |
(27,850) |
Net Effect |
(1,210) |
1,210 |
NIL |
|
|
|
|
Page No 1.74:
Question 56:
Journal |
|||||
Date |
Particulars |
L. F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
A’s Capital A/c |
Dr. |
|
1,210 |
|
|
To B’s Capital A/c |
|
|
1,210 |
|
|
(Amount of interest on Capital and interest on drawings adjusted) |
|
|
|
|
|
|
|
|
|
Partners’ Capital Accounts |
||||||
Dr. |
Cr. |
|||||
Particulars |
A |
B |
Particulars |
A |
B |
|
B’s Capital A/c |
1,210 |
|
Balance b/d |
4,00,000 |
3,00,000 |
|
|
|
|
A’s Capital A/c |
- |
1,210 |
|
Balance c/d |
3,98,790 |
3,01,210 |
|
|
|
|
|
4,00,000 |
3,01,210 |
|
4,00,000 |
3,01,210 |
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Capital as on April 01, 2014 (Opening Capital)
Particulars |
A |
B |
Total |
Capital as on March 31, 2015 (Closing) |
4,00,000 |
3,00,000 |
7,00,000 |
Add: Drawings |
48,000 |
36,000 |
84,000 |
Less: Profit (3:2) |
(1,20,000) |
(80,000) |
(2,00,000) |
Capital as on April 01, 2014 (Opening) |
3,28,000 |
2,56,000 |
5,84,000 |
|
|
|
|
WN 2 Calculation on Interest on Capital
WN 3 Calculation of Interest on Drawings
WN 4
Statement Showing Adjustment |
|||
Particulars |
A |
B |
Total |
Interest on Capital (to be credited) |
16,400 |
12,800 |
29,200 |
Less: Interest on Drawings |
(900) |
(450) |
(1,350) |
Right distribution of Rs 27,850 |
15,500 |
12,350 |
27,850 |
Less: Wrong Distribution of Rs 27,850 (3:2) |
(16,710) |
(11,140) |
(27,850) |
Net Effect |
(1,210) |
1,210 |
NIL |
|
|
|
|
Answer:
Journal |
|||||
Date |
Particulars |
L. F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
Q’s Capital A/c |
Dr. |
|
4,000 |
|
|
R’s Capital A/c |
Dr. |
|
1,000 |
|
|
To P’s Capital A/c |
|
|
5,000 |
|
|
(Interest on Capital was omitted, now adjusted) |
|
|
|
|
|
|
|
|
|
Partners’ Capital Accounts |
||||||||
Dr. |
Cr. |
|||||||
Particulars |
P |
Q |
R |
Particulars |
P |
Q |
R |
|
P’s Capital |
|
4,000 |
1,000 |
Balance b/d |
1,50,000 |
1,80,000 |
2,10,000 |
|
|
|
|
|
Q’s Capital |
4,000 |
|
|
|
Balance c/d |
1,55,000 |
1,76,000 |
2,09,000 |
R’s Capital |
1,000 |
|
|
|
|
1,55,000 |
1,80,000 |
2,10,000 |
|
1,55,000 |
1,80,000 |
2,10,000 |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Capital as on April 01, 2013 (Opening Capital)
Particulars |
P |
Q |
R |
Total |
Capital as on March 31, 2014 (Closing) |
1,50,000 |
1,80,000 |
2,10,000 |
5,40,000 |
Add: Drawings |
20,000 |
20,000 |
20,000 |
60,000 |
Less: Profit (1:2:2) |
(12,000) |
(24,000) |
(24,000) |
(60,000) |
Capital as April 01, 2013 (Opening) |
1,58,000 |
1,76,000 |
2,06,000 |
5,40,000 |
|
|
|
|
|
WN 2 Calculation of Interest on Capital
WN 4
Statement Showing Adjustment |
||||
Particulars |
P |
Q |
R |
Total |
Interest on Capital to be credited |
15,800 |
17,600 |
20,600 |
54,000 |
For sharing above Loss (1 : 2 : 2) |
(10,800) |
(21,600) |
(21,600) |
(54,000) |
Net Effect |
5,000 (Cr.) |
(4,000) (Dr.) |
(1,000) (Dr.) |
(NIL) |
|
|
|
|
|
Page No 1.74:
Question 57:
Journal |
|||||
Date |
Particulars |
L. F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
Q’s Capital A/c |
Dr. |
|
4,000 |
|
|
R’s Capital A/c |
Dr. |
|
1,000 |
|
|
To P’s Capital A/c |
|
|
5,000 |
|
|
(Interest on Capital was omitted, now adjusted) |
|
|
|
|
|
|
|
|
|
Partners’ Capital Accounts |
||||||||
Dr. |
Cr. |
|||||||
Particulars |
P |
Q |
R |
Particulars |
P |
Q |
R |
|
P’s Capital |
|
4,000 |
1,000 |
Balance b/d |
1,50,000 |
1,80,000 |
2,10,000 |
|
|
|
|
|
Q’s Capital |
4,000 |
|
|
|
Balance c/d |
1,55,000 |
1,76,000 |
2,09,000 |
R’s Capital |
1,000 |
|
|
|
|
1,55,000 |
1,80,000 |
2,10,000 |
|
1,55,000 |
1,80,000 |
2,10,000 |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Capital as on April 01, 2013 (Opening Capital)
Particulars |
P |
Q |
R |
Total |
Capital as on March 31, 2014 (Closing) |
1,50,000 |
1,80,000 |
2,10,000 |
5,40,000 |
Add: Drawings |
20,000 |
20,000 |
20,000 |
60,000 |
Less: Profit (1:2:2) |
(12,000) |
(24,000) |
(24,000) |
(60,000) |
Capital as April 01, 2013 (Opening) |
1,58,000 |
1,76,000 |
2,06,000 |
5,40,000 |
|
|
|
|
|
WN 2 Calculation of Interest on Capital
WN 4
Statement Showing Adjustment |
||||
Particulars |
P |
Q |
R |
Total |
Interest on Capital to be credited |
15,800 |
17,600 |
20,600 |
54,000 |
For sharing above Loss (1 : 2 : 2) |
(10,800) |
(21,600) |
(21,600) |
(54,000) |
Net Effect |
5,000 (Cr.) |
(4,000) (Dr.) |
(1,000) (Dr.) |
(NIL) |
|
|
|
|
|
Answer:
Journal |
||||
Particulars |
L. F. |
Debit Amount Rs |
Credit Amount Rs |
|
Anilâs Capital A/c |
Dr. |
|
550 |
|
To Mohanâs Capital A/c |
|
|
550 |
|
(Interest on capital and interest on drawings was omitted, now adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Capital at the beginning
Particulars |
Mohan |
Vijay |
Anil |
Total |
Capital at the end |
30,000 |
25,000 |
20,000 |
75,000 |
Add: Drawings |
5,000 |
4,000 |
3,000 |
12,000 |
Less: Profit (1:1:1) |
(8,000) |
(8,000) |
(8,000) |
(24,000) |
Capital in the beginning |
27,000 |
21,000 |
15,000 |
63,000 |
|
|
|
|
|
WN 2 Calculation of Interest on Capital
WN 3
Statement Showing Adjustment |
||||
|
Mohan |
Vijay |
Anil |
Total |
Interest on Capital to be credited |
2,700 |
2,100 |
1,500 |
6,300 |
Less: Interest on Drawings |
(250) |
(200) |
(150) |
(600) |
Right Distribution of Rs 5,700 |
2,450 |
1,900 |
1,350 |
5,700 |
Wrong Distribution of Rs 5,700 (1:1:1) |
(1,900) |
(1,900) |
(1,900) |
(5,700) |
Net Effect |
550 |
Nil |
(550) |
NIL |
|
|
|
|
|
WN 4 Calculation of Final Profit Share of Partners
Total Corrected Profit Available for Distribution = Profit - Interest on Capital + Interest on Drawings = 24,000 - 6,300 + 600 = Rs 18,300
Page No 1.74:
Question 58:
Journal |
||||
Particulars |
L. F. |
Debit Amount Rs |
Credit Amount Rs |
|
Anilâs Capital A/c |
Dr. |
|
550 |
|
To Mohanâs Capital A/c |
|
|
550 |
|
(Interest on capital and interest on drawings was omitted, now adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Capital at the beginning
Particulars |
Mohan |
Vijay |
Anil |
Total |
Capital at the end |
30,000 |
25,000 |
20,000 |
75,000 |
Add: Drawings |
5,000 |
4,000 |
3,000 |
12,000 |
Less: Profit (1:1:1) |
(8,000) |
(8,000) |
(8,000) |
(24,000) |
Capital in the beginning |
27,000 |
21,000 |
15,000 |
63,000 |
|
|
|
|
|
WN 2 Calculation of Interest on Capital
WN 3
Statement Showing Adjustment |
||||
|
Mohan |
Vijay |
Anil |
Total |
Interest on Capital to be credited |
2,700 |
2,100 |
1,500 |
6,300 |
Less: Interest on Drawings |
(250) |
(200) |
(150) |
(600) |
Right Distribution of Rs 5,700 |
2,450 |
1,900 |
1,350 |
5,700 |
Wrong Distribution of Rs 5,700 (1:1:1) |
(1,900) |
(1,900) |
(1,900) |
(5,700) |
Net Effect |
550 |
Nil |
(550) |
NIL |
|
|
|
|
|
WN 4 Calculation of Final Profit Share of Partners
Total Corrected Profit Available for Distribution = Profit - Interest on Capital + Interest on Drawings = 24,000 - 6,300 + 600 = Rs 18,300
Answer:
Journal |
||||
Particulars |
L. F. |
Debit Amount Rs |
Credit Amount Rs |
|
Ramâs Capital A/c |
Dr. |
|
300 |
|
To Sohanâs Capital A/c |
|
|
300 |
|
(Interest on Capital was wrongly credited, now adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital at 6% p.a.
WN 2 Calculation of Interest on Capital at 5% p.a.
WN 3
Statement Showing Adjustment |
||||
Particulars |
Ram |
Mohan |
Sohan |
Total |
Interest on Capital wrongly credited at 6% p.a. reversed |
(7,200) |
(5,400) |
(3,600) |
(16,200) |
Interest on Capital credited at 5% p.a. |
6,000 |
4,500 |
3,000 |
13,500 |
Wrong Distribution |
(1,200) |
(900) |
(600) |
(2,700) |
Right Distribution of Rs 2,700 (1:1:1) |
900 |
900 |
900 |
(2,700) |
Net Effect |
(300) |
NIL |
300 |
NIL |
|
|
|
|
|
Page No 1.74:
Question 59:
Journal |
||||
Particulars |
L. F. |
Debit Amount Rs |
Credit Amount Rs |
|
Ramâs Capital A/c |
Dr. |
|
300 |
|
To Sohanâs Capital A/c |
|
|
300 |
|
(Interest on Capital was wrongly credited, now adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital at 6% p.a.
WN 2 Calculation of Interest on Capital at 5% p.a.
WN 3
Statement Showing Adjustment |
||||
Particulars |
Ram |
Mohan |
Sohan |
Total |
Interest on Capital wrongly credited at 6% p.a. reversed |
(7,200) |
(5,400) |
(3,600) |
(16,200) |
Interest on Capital credited at 5% p.a. |
6,000 |
4,500 |
3,000 |
13,500 |
Wrong Distribution |
(1,200) |
(900) |
(600) |
(2,700) |
Right Distribution of Rs 2,700 (1:1:1) |
900 |
900 |
900 |
(2,700) |
Net Effect |
(300) |
NIL |
300 |
NIL |
|
|
|
|
|
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Shyam’s Current A/c |
Dr. |
|
200 |
|
Mohan’s Current A/c |
Dr. |
|
400 |
|
To Ram’s Current A/c |
|
|
600 |
|
(Interest on Capital adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital 10% p.a.
WN 2 Calculation of Interest on Capital 9% p.a.
WN 3
Statement Showing Adjustment |
||||
Particulars |
Ram |
Shyam |
Mohan |
Total |
Interest on Capital credited at 10% p.a. |
30,000 |
10,000 |
20,000 |
60,000 |
Interest on Capital wrongly credited at 9% p.a. reversed |
(27,000) |
(9,000) |
(18,000) |
(54,000) |
Right distribution |
3,000 |
1,000 |
2,000 |
6,000 |
Wrong distribution of Rs 6,000 (2:1:2) |
(2,400) |
(1,200) |
(2,400) |
(6,000) |
Net Effect |
600 |
(200) |
(400) |
NIL |
|
|
|
|
|
Page No 1.74:
Question 60:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Shyam’s Current A/c |
Dr. |
|
200 |
|
Mohan’s Current A/c |
Dr. |
|
400 |
|
To Ram’s Current A/c |
|
|
600 |
|
(Interest on Capital adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital 10% p.a.
WN 2 Calculation of Interest on Capital 9% p.a.
WN 3
Statement Showing Adjustment |
||||
Particulars |
Ram |
Shyam |
Mohan |
Total |
Interest on Capital credited at 10% p.a. |
30,000 |
10,000 |
20,000 |
60,000 |
Interest on Capital wrongly credited at 9% p.a. reversed |
(27,000) |
(9,000) |
(18,000) |
(54,000) |
Right distribution |
3,000 |
1,000 |
2,000 |
6,000 |
Wrong distribution of Rs 6,000 (2:1:2) |
(2,400) |
(1,200) |
(2,400) |
(6,000) |
Net Effect |
600 |
(200) |
(400) |
NIL |
|
|
|
|
|
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
A’s Capital A/c |
Dr. |
|
1,500 |
|
B’s Capital A/c |
Dr. |
|
8,250 |
|
To C’s Capital A/c |
|
|
9,750 |
|
(Adjustment of profit made) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit available for Distribution
Profit available for distribution = Net Profit − Interest on Capital − Salary to C
= 45000 − 5000 − 18000 = Rs 22,000
WN 3 Right Distribution of Rs 45,000
Particulars |
A |
B |
C |
Total |
Interest on Capital to be credited |
2,500 |
1,250 |
1,250 |
5,000 |
Salary to be credited |
|
|
1,8000 |
18,000 |
Distribution of Profit Rs 22,000 |
11,000 |
5,500 |
5,500 |
22,000 |
Total Profit |
13,500 |
6,750 |
24,750 |
45,000 |
|
|
|
|
|
WN 4 Wrong Distribution of Rs 45,000 in equal Ratio
WN 5
Statement Showing Adjustment |
||||
Particulars |
A |
B |
C |
Total |
Right Distribution of Profit (WN 3) |
13,500 |
6,750 |
24,750 |
45,000 |
Wrong Distribution of Profit (WN 4) |
(15,000) |
(15,000) |
(15,000) |
(45,000) |
Net Effect |
(1,500) |
(8,250) |
9,750 |
NIL |
|
|
|
|
|
Page No 1.74:
Question 61:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
A’s Capital A/c |
Dr. |
|
1,500 |
|
B’s Capital A/c |
Dr. |
|
8,250 |
|
To C’s Capital A/c |
|
|
9,750 |
|
(Adjustment of profit made) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit available for Distribution
Profit available for distribution = Net Profit − Interest on Capital − Salary to C
= 45000 − 5000 − 18000 = Rs 22,000
WN 3 Right Distribution of Rs 45,000
Particulars |
A |
B |
C |
Total |
Interest on Capital to be credited |
2,500 |
1,250 |
1,250 |
5,000 |
Salary to be credited |
|
|
1,8000 |
18,000 |
Distribution of Profit Rs 22,000 |
11,000 |
5,500 |
5,500 |
22,000 |
Total Profit |
13,500 |
6,750 |
24,750 |
45,000 |
|
|
|
|
|
WN 4 Wrong Distribution of Rs 45,000 in equal Ratio
WN 5
Statement Showing Adjustment |
||||
Particulars |
A |
B |
C |
Total |
Right Distribution of Profit (WN 3) |
13,500 |
6,750 |
24,750 |
45,000 |
Wrong Distribution of Profit (WN 4) |
(15,000) |
(15,000) |
(15,000) |
(45,000) |
Net Effect |
(1,500) |
(8,250) |
9,750 |
NIL |
|
|
|
|
|
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
B’s Current A/c |
Dr. |
|
5,600 |
|
To A’s Current A/c |
|
|
5,600 |
|
(Adjustment of Profit made as per new agreement) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit available for Distribution
Profit available for Distribution (after interest on capital) = 60,000 − 9,000 = Rs 51,000
Profit sharing ratio = 3 : 2
WN 3
Statement Showing Adjustment |
|||
Particulars |
A |
B |
Total |
Interest on Capital to be credited |
5,000 |
4,000 |
9,000 |
Profit after Interest on Capital (3:2) |
30,600 |
20,400 |
51,000 |
Right Distribution of Profit (to be credited) |
35,600 |
24,400 |
60,000 |
|
|
|
|
Wrong Distribution of Profit (to be debited) (1 : 1) |
(30,000) |
(30,000) |
(60,000) |
Net Effect |
5,600 |
(5,600) |
NIL |
|
|
|
|
Page No 1.74:
Question 62:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
B’s Current A/c |
Dr. |
|
5,600 |
|
To A’s Current A/c |
|
|
5,600 |
|
(Adjustment of Profit made as per new agreement) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculation of Profit available for Distribution
Profit available for Distribution (after interest on capital) = 60,000 − 9,000 = Rs 51,000
Profit sharing ratio = 3 : 2
WN 3
Statement Showing Adjustment |
|||
Particulars |
A |
B |
Total |
Interest on Capital to be credited |
5,000 |
4,000 |
9,000 |
Profit after Interest on Capital (3:2) |
30,600 |
20,400 |
51,000 |
Right Distribution of Profit (to be credited) |
35,600 |
24,400 |
60,000 |
|
|
|
|
Wrong Distribution of Profit (to be debited) (1 : 1) |
(30,000) |
(30,000) |
(60,000) |
Net Effect |
5,600 |
(5,600) |
NIL |
|
|
|
|
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
A’s Current A/c |
Dr. |
|
286 |
|
To B’s Current A/c |
|
|
82 |
|
To C’s Current A/c |
|
|
204 |
|
(Interest on Capital wrong credited, now adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
Year 2010–11 |
A |
B |
C |
= |
Total |
Wrong Distribution |
|
|
|
|
|
Interest on Capital (to be debited) |
(350) |
(200) |
(110) |
= |
(660) |
For sharing above profit (1:1:1) |
220 |
220 |
220 |
= |
660 |
|
(130) |
20 |
110 |
= |
NIL |
|
|
|
|
|
|
Year 2011–12 |
A |
B |
C |
= |
Total |
Wrong Distribution |
|
|
|
|
|
Interest on Capital (to be debited) |
(360) |
(210) |
(110) |
= |
(680) |
For sharing above profit (3:4:3) |
204 |
272 |
204 |
= |
680 |
|
(156) |
62 |
94 |
= |
NIL |
|
|
|
|
|
|
Adjustment of Profit |
A |
B |
C |
For 2010–2011 |
(130) |
20 |
110 |
For 2011–2012 |
(156) |
62 |
94 |
Net Effect |
(286) |
82 |
204 |
|
|
|
|
Page No 1.75:
Question 63:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
A’s Current A/c |
Dr. |
|
286 |
|
To B’s Current A/c |
|
|
82 |
|
To C’s Current A/c |
|
|
204 |
|
(Interest on Capital wrong credited, now adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
Year 2010–11 |
A |
B |
C |
= |
Total |
Wrong Distribution |
|
|
|
|
|
Interest on Capital (to be debited) |
(350) |
(200) |
(110) |
= |
(660) |
For sharing above profit (1:1:1) |
220 |
220 |
220 |
= |
660 |
|
(130) |
20 |
110 |
= |
NIL |
|
|
|
|
|
|
Year 2011–12 |
A |
B |
C |
= |
Total |
Wrong Distribution |
|
|
|
|
|
Interest on Capital (to be debited) |
(360) |
(210) |
(110) |
= |
(680) |
For sharing above profit (3:4:3) |
204 |
272 |
204 |
= |
680 |
|
(156) |
62 |
94 |
= |
NIL |
|
|
|
|
|
|
Adjustment of Profit |
A |
B |
C |
For 2010–2011 |
(130) |
20 |
110 |
For 2011–2012 |
(156) |
62 |
94 |
Net Effect |
(286) |
82 |
204 |
|
|
|
|
Answer:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
P’s Current A/c |
Dr. |
|
300 |
|
|
To Q’s Capital A/c |
|
|
8 |
|
|
To R’s Capital A/c |
|
|
292 |
|
|
(Interest on Capital was omitted, now adjusted) |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Capital at the beginning (as on April 01, 2013)
Particulars |
P |
Q |
R |
Capital as on March 31, 2014 (Closing) |
40,000 |
30,000 |
20,000 |
Add: Drawings |
10,000 |
7,500 |
4,500 |
Less: Profit Rs 60,000 (3:2:1) |
(30,000) |
(20,000) |
(10,000) |
Capital as on April 01, 2013 (Opening) |
20,000 |
17,500 |
14,500 |
|
|
|
|
WN 2 Calculation of Interest on Capital
WN 3
Statement Showing Adjustment |
||||
Particulars |
P |
Q |
R |
Total |
Interest on Capital (to be credited) |
1,000 |
875 |
725 |
2,600 |
For sharing above Loss (3:2:1) |
(1,300) |
(867) |
(433) |
(2,600) |
Net Effect |
(300) |
8 |
292 |
NIL |
|
|
|
|
|
Page No 1.75:
Question 64:
Journal |
|||||
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
|
P’s Current A/c |
Dr. |
|
300 |
|
|
To Q’s Capital A/c |
|
|
8 |
|
|
To R’s Capital A/c |
|
|
292 |
|
|
(Interest on Capital was omitted, now adjusted) |
|
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Capital at the beginning (as on April 01, 2013)
Particulars |
P |
Q |
R |
Capital as on March 31, 2014 (Closing) |
40,000 |
30,000 |
20,000 |
Add: Drawings |
10,000 |
7,500 |
4,500 |
Less: Profit Rs 60,000 (3:2:1) |
(30,000) |
(20,000) |
(10,000) |
Capital as on April 01, 2013 (Opening) |
20,000 |
17,500 |
14,500 |
|
|
|
|
WN 2 Calculation of Interest on Capital
WN 3
Statement Showing Adjustment |
||||
Particulars |
P |
Q |
R |
Total |
Interest on Capital (to be credited) |
1,000 |
875 |
725 |
2,600 |
For sharing above Loss (3:2:1) |
(1,300) |
(867) |
(433) |
(2,600) |
Net Effect |
(300) |
8 |
292 |
NIL |
|
|
|
|
|
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Shiv’s Current A/c |
Dr. |
|
6,636 |
|
To Shankar’s Current A/c |
|
|
6,636 |
|
(Interest on Capital and Interest on drawings was omitted, now adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculating of Interest on Drawings
WN 3
Statement Showing Adjustment |
|||
Particulars |
Shiv |
Shankar |
Total |
Interest on Capital (to be credited) |
20,400 |
25,200 |
45,600 |
Interest Drawings (to be debited) |
(1,620) |
(1,620) |
(3,240) |
Right Distribution |
18,780 |
23,580 |
42,360 |
Wrong Distribution (3 : 2) |
(25,416) |
(16,944) |
(42,360) |
Net Effect |
(6,636) |
6,636 |
NIL |
|
|
|
|
Page No 1.75:
Question 65:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
Shiv’s Current A/c |
Dr. |
|
6,636 |
|
To Shankar’s Current A/c |
|
|
6,636 |
|
(Interest on Capital and Interest on drawings was omitted, now adjusted) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Calculating of Interest on Drawings
WN 3
Statement Showing Adjustment |
|||
Particulars |
Shiv |
Shankar |
Total |
Interest on Capital (to be credited) |
20,400 |
25,200 |
45,600 |
Interest Drawings (to be debited) |
(1,620) |
(1,620) |
(3,240) |
Right Distribution |
18,780 |
23,580 |
42,360 |
Wrong Distribution (3 : 2) |
(25,416) |
(16,944) |
(42,360) |
Net Effect |
(6,636) |
6,636 |
NIL |
|
|
|
|
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
A’s Current A/c |
Dr. |
|
3,675 |
|
To B’s Current A/c |
|
|
2,895 |
|
To C’s Current A/c |
|
|
780 |
|
(Adjustment of profit made) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Salary to B = Rs 500 × 12 = Rs 6,000
WN 3 Calculation of Commission to C
Commission to C = 5% on profit after interest on capital but before salary
Profit after Interest on Capital but before Salary = 30,000 − 3,000 = Rs 27,000
WN 4 Calculation of Profit Share of each Partner
Profit available for Distribution = 30,000 − 3,000 − 6,000 − 1,350 = Rs 19,650
WN 5
Statement Showing Adjustment |
||||
Particulars |
A |
B |
C |
Total |
Interest on Capital (to be credited) |
1,500 |
1,000 |
500 |
3,000 |
Salary/ Commission (to be credited) |
- |
6,000 |
1,350 |
7,350 |
Profit (to be credited) |
9,825 |
5,895 |
3,930 |
19,650 |
Right Distribution |
11,325 |
12,895 |
5,780 |
30,000 |
Wrong Distribution of Rs 30,000 (3:2:1) |
(15,000) |
(10,000) |
(5,000) |
(30,000) |
Net Effect |
(3,675) |
2,895 |
780 |
NIL |
|
|
|
|
|
Page No 1.75:
Question 66:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
A’s Current A/c |
Dr. |
|
3,675 |
|
To B’s Current A/c |
|
|
2,895 |
|
To C’s Current A/c |
|
|
780 |
|
(Adjustment of profit made) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Calculation of Interest on Capital
WN 2 Salary to B = Rs 500 × 12 = Rs 6,000
WN 3 Calculation of Commission to C
Commission to C = 5% on profit after interest on capital but before salary
Profit after Interest on Capital but before Salary = 30,000 − 3,000 = Rs 27,000
WN 4 Calculation of Profit Share of each Partner
Profit available for Distribution = 30,000 − 3,000 − 6,000 − 1,350 = Rs 19,650
WN 5
Statement Showing Adjustment |
||||
Particulars |
A |
B |
C |
Total |
Interest on Capital (to be credited) |
1,500 |
1,000 |
500 |
3,000 |
Salary/ Commission (to be credited) |
- |
6,000 |
1,350 |
7,350 |
Profit (to be credited) |
9,825 |
5,895 |
3,930 |
19,650 |
Right Distribution |
11,325 |
12,895 |
5,780 |
30,000 |
Wrong Distribution of Rs 30,000 (3:2:1) |
(15,000) |
(10,000) |
(5,000) |
(30,000) |
Net Effect |
(3,675) |
2,895 |
780 |
NIL |
|
|
|
|
|
Answer:
Journal |
|
|||||
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
||
|
|
|
|
|
|
|
|
A’s Capital A/c |
Dr. |
|
2,520 |
|
|
|
C’s Capital A/c |
Dr. |
|
2,740 |
|
|
|
To B’s Capital A/c |
|
|
|
5,260 |
|
|
(Adjustment of profit made) |
|
|
|
|
Working Notes
WN 1) Calculation of Interest on Capital
WN 2) Interest on drawing is given to be
For A – Rs 350
For B – Rs 250
For C – Rs 150
WN 3) Salaries
To A – Rs 5,000, and
To B – Rs 7,500
WN 4) Commission to A Rs 3,000
WN 5) Calculation of Profit share of each Partner
Profit available for distribution = 30,000 – 7,200 + 750 – 12,500 – 3,000 = Rs 8,050
WN 6)
Statement Showing Adjustment |
||||
Particulars |
A |
B |
C |
Total |
Interest on Capital (to be credited) |
3,000 |
2,400 |
1,800 |
7,200 |
Interest on Drawings (to be debited) |
(350) |
(250) |
(150) |
(750) |
Salaries to A and B (to be credited) |
5,000 |
7,500 |
|
12,500 |
Commission to A (to be credited) |
3,000 |
|
|
3,000 |
Profits to be credited |
4,830 |
1,610 |
1,610 |
8,050 |
Right Distribution of Profits |
15,480 |
11,260 |
3,260 |
30,000 |
Wrong Distribution of Profits (3:1:1) |
(18,000) |
(6,000) |
(6,000) |
(30,000) |
Net Effect |
2,520 Dr. |
5,260 Cr. |
2,740 Dr. |
- |
Page No 1.76:
Question 67:
Journal |
|
|||||
Date |
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
||
|
|
|
|
|
|
|
|
A’s Capital A/c |
Dr. |
|
2,520 |
|
|
|
C’s Capital A/c |
Dr. |
|
2,740 |
|
|
|
To B’s Capital A/c |
|
|
|
5,260 |
|
|
(Adjustment of profit made) |
|
|
|
|
Working Notes
WN 1) Calculation of Interest on Capital
WN 2) Interest on drawing is given to be
For A – Rs 350
For B – Rs 250
For C – Rs 150
WN 3) Salaries
To A – Rs 5,000, and
To B – Rs 7,500
WN 4) Commission to A Rs 3,000
WN 5) Calculation of Profit share of each Partner
Profit available for distribution = 30,000 – 7,200 + 750 – 12,500 – 3,000 = Rs 8,050
WN 6)
Statement Showing Adjustment |
||||
Particulars |
A |
B |
C |
Total |
Interest on Capital (to be credited) |
3,000 |
2,400 |
1,800 |
7,200 |
Interest on Drawings (to be debited) |
(350) |
(250) |
(150) |
(750) |
Salaries to A and B (to be credited) |
5,000 |
7,500 |
|
12,500 |
Commission to A (to be credited) |
3,000 |
|
|
3,000 |
Profits to be credited |
4,830 |
1,610 |
1,610 |
8,050 |
Right Distribution of Profits |
15,480 |
11,260 |
3,260 |
30,000 |
Wrong Distribution of Profits (3:1:1) |
(18,000) |
(6,000) |
(6,000) |
(30,000) |
Net Effect |
2,520 Dr. |
5,260 Cr. |
2,740 Dr. |
- |
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
C’s Loan A/c |
Dr. |
|
20,000 |
|
To C’s Capital |
|
|
20,000 |
|
(C’s Loan transfer to his Capital Account) |
|
|
|
|
|
|
|
|
|
A’s Capital A/c |
Dr. |
|
360 |
|
B’s Capital A/c |
Dr. |
|
240 |
|
To C’s Capital A/c |
|
|
600 |
|
(C loan from A and B as a partner) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Profit before C’s Salary and Interest on Loan.
Year |
Profit/ Loss |
+ |
Salary |
+ |
Interest on C’s loan |
= |
Profit before C’s Salary and Interest on Loan |
2006 |
59,000 |
+ |
9,000 |
+ |
1,800 |
= |
69,800 |
2007 |
62,600 |
+ |
9,000 |
+ |
1,800 |
= |
73,400 |
2008 |
(4,000) |
+ |
9,000 |
+ |
1,800 |
= |
6,800 |
2009 |
78,000 |
+ |
9,000 |
+ |
1,800 |
= |
88,800 |
Profit before Interest on C’s Capital (for 4 years) |
2,38,800 |
||||||
|
|
WN 2 Calculation of Interest on Capital
Interest on C’s Capital for 4 years = 1,200 × 4 = Rs 4,800
WN 3 Calculation of C’s Share of Profit as a Partner
Profit after Interest on C’s Capital = Profit before Interest on C’s Capital − Interest on C’s Capital
= 2,38,800 − 4,800 = Rs 2,34,000
C’s Profit Share as a Partner for 4 years
∴C’s Share of Interest on Capital and Profit Share as a Partner = 4,800 + 39,000 = Rs 43,800
C’s Salary and Interest on Loan as Manager = 7,200 + 36,000 = Rs 43,200
Adjustment of C’s share of Profit
C’s Share as a Partner |
43,800 |
Less: C’s Share as a Manager |
(43,200) |
C will get from A and B in their profit sharing ratio |
600 |
|
|
Profit to be transferred by A and B in favour of C
Page No 1.76:
Question 68:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
C’s Loan A/c |
Dr. |
|
20,000 |
|
To C’s Capital |
|
|
20,000 |
|
(C’s Loan transfer to his Capital Account) |
|
|
|
|
|
|
|
|
|
A’s Capital A/c |
Dr. |
|
360 |
|
B’s Capital A/c |
Dr. |
|
240 |
|
To C’s Capital A/c |
|
|
600 |
|
(C loan from A and B as a partner) |
|
|
|
|
|
|
|
|
Working Notes:
WN 1 Profit before C’s Salary and Interest on Loan.
Year |
Profit/ Loss |
+ |
Salary |
+ |
Interest on C’s loan |
= |
Profit before C’s Salary and Interest on Loan |
2006 |
59,000 |
+ |
9,000 |
+ |
1,800 |
= |
69,800 |
2007 |
62,600 |
+ |
9,000 |
+ |
1,800 |
= |
73,400 |
2008 |
(4,000) |
+ |
9,000 |
+ |
1,800 |
= |
6,800 |
2009 |
78,000 |
+ |
9,000 |
+ |
1,800 |
= |
88,800 |
Profit before Interest on C’s Capital (for 4 years) |
2,38,800 |
||||||
|
|
WN 2 Calculation of Interest on Capital
Interest on C’s Capital for 4 years = 1,200 × 4 = Rs 4,800
WN 3 Calculation of C’s Share of Profit as a Partner
Profit after Interest on C’s Capital = Profit before Interest on C’s Capital − Interest on C’s Capital
= 2,38,800 − 4,800 = Rs 2,34,000
C’s Profit Share as a Partner for 4 years
∴C’s Share of Interest on Capital and Profit Share as a Partner = 4,800 + 39,000 = Rs 43,800
C’s Salary and Interest on Loan as Manager = 7,200 + 36,000 = Rs 43,200
Adjustment of C’s share of Profit
C’s Share as a Partner |
43,800 |
Less: C’s Share as a Manager |
(43,200) |
C will get from A and B in their profit sharing ratio |
600 |
|
|
Profit to be transferred by A and B in favour of C
Answer:
Profit and Loss Appropriation Account for the year ended 2009 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
31,500 |
|
A’s Capital A/c |
16,000 |
|
|
|
B’s Capital A/c |
8,000 |
|
|
|
C’s Capital A/c |
7,500 |
31,500 |
|
|
|
31,500 |
|
31,500 |
|
|
|
|
|
Working Notes:
Profit for the year = Rs 31,500
Profit sharing ratio = 4 : 2 : 1
C is given a guarantee of minimum profit of Rs 7,500
C’s Actual Profit Share (i.e. Rs 4,500) is less than his Minimum Guaranteed Profit (i.e. Rs 7,500) ∴Deficiency in C’s Profit Share = 7,500 − 4,500 = Rs 3,000
This deficiency is to be borne by A and B in their profit sharing ratio i.e. 4 : 2
Therefore,
Final Profit Share of A = 18,000 − 2,000 = Rs 16,000
Final Profit Share of B = 9,000 − 1,000 = Rs 8,000
Final Profit Share of C = 4,500 + 3,000 = Rs 7,500
Page No 1.76:
Question 69:
Profit and Loss Appropriation Account for the year ended 2009 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
31,500 |
|
A’s Capital A/c |
16,000 |
|
|
|
B’s Capital A/c |
8,000 |
|
|
|
C’s Capital A/c |
7,500 |
31,500 |
|
|
|
31,500 |
|
31,500 |
|
|
|
|
|
Working Notes:
Profit for the year = Rs 31,500
Profit sharing ratio = 4 : 2 : 1
C is given a guarantee of minimum profit of Rs 7,500
C’s Actual Profit Share (i.e. Rs 4,500) is less than his Minimum Guaranteed Profit (i.e. Rs 7,500) ∴Deficiency in C’s Profit Share = 7,500 − 4,500 = Rs 3,000
This deficiency is to be borne by A and B in their profit sharing ratio i.e. 4 : 2
Therefore,
Final Profit Share of A = 18,000 − 2,000 = Rs 16,000
Final Profit Share of B = 9,000 − 1,000 = Rs 8,000
Final Profit Share of C = 4,500 + 3,000 = Rs 7,500
Answer:
Profit and Loss Appropriation Account for the year ended 2012 |
||||
Dr. | Cr. | |||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: (WN 1) |
|
Profit and Loss A/c (Net Profit) |
40,000 |
|
A’s Capital A/c |
16,000 |
|
|
|
B’s Capital A/c |
14,000 |
|
|
|
C’s Capital A/c |
10,000 |
40,000 |
|
|
|
40,000 |
|
40,000 |
|
|
|
|
|
Profit and Loss Appropriation Account for the year ended 2013 |
||||
Dr. | Cr. | |||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
60,000 |
|
A’s Capital A/c |
24,000 |
|
|
|
B’s Capital A/c |
24,000 |
|
|
|
C’s Capital A/c |
12,000 |
60,000 |
|
|
|
60,000 |
|
60,000 |
|
|
|
|
|
Working Notes:
WN 1 Distribution of Profit for the year 2012
Profit for 2012 = Rs 40,000
Profit sharing ratio = 2 : 2 : 1
C is given a guarantee of minimum profit of Rs 10,000
Deficiency in C’s Profit Share = 10,000 − 8,000 = Rs 2,000
This deficiency is to be borne by B.
Therefore,
Final Profit Share of A = 16,000
Final Profit Share of B = 16,000 − 2,000 = Rs 14,000
Final Profit Share of C = 8,000 + 2,000 = Rs 10,000
WN 2 Distribution of Profit for the year 2013
Profit for 2013 = Rs 60,000
Profit sharing ratio = 2 : 2 : 1
C is given a guarantee of minimum profit of Rs 10,000
Page No 1.76:
Question 70:
Profit and Loss Appropriation Account for the year ended 2012 |
||||
Dr. | Cr. | |||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: (WN 1) |
|
Profit and Loss A/c (Net Profit) |
40,000 |
|
A’s Capital A/c |
16,000 |
|
|
|
B’s Capital A/c |
14,000 |
|
|
|
C’s Capital A/c |
10,000 |
40,000 |
|
|
|
40,000 |
|
40,000 |
|
|
|
|
|
Profit and Loss Appropriation Account for the year ended 2013 |
||||
Dr. | Cr. | |||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
60,000 |
|
A’s Capital A/c |
24,000 |
|
|
|
B’s Capital A/c |
24,000 |
|
|
|
C’s Capital A/c |
12,000 |
60,000 |
|
|
|
60,000 |
|
60,000 |
|
|
|
|
|
Working Notes:
WN 1 Distribution of Profit for the year 2012
Profit for 2012 = Rs 40,000
Profit sharing ratio = 2 : 2 : 1
C is given a guarantee of minimum profit of Rs 10,000
Deficiency in C’s Profit Share = 10,000 − 8,000 = Rs 2,000
This deficiency is to be borne by B.
Therefore,
Final Profit Share of A = 16,000
Final Profit Share of B = 16,000 − 2,000 = Rs 14,000
Final Profit Share of C = 8,000 + 2,000 = Rs 10,000
WN 2 Distribution of Profit for the year 2013
Profit for 2013 = Rs 60,000
Profit sharing ratio = 2 : 2 : 1
C is given a guarantee of minimum profit of Rs 10,000
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2013 |
||||
Dr. |
|
|
|
Cr. |
Particulars |
|
Amount Rs |
Particulars |
Amount Rs |
Interest on Capital to: |
|
|
Profit and Loss A/c (Net Profit) |
79,500 |
A |
8,000 |
|
|
|
B |
5,000 |
|
|
|
C |
4,000 |
17,000 |
|
|
Profit transferred to: |
|
|
|
|
A |
28,750 |
|
|
|
B |
18,750 |
|
|
|
C |
15,000 |
62,500 |
|
|
|
|
79,500 |
|
79,500 |
|
|
Working Notes:
Profit available for distribution = 79,500 – 17,000 = Rs 62,500
Profit sharing ratio = 5 : 3 : 2
C’s Minimum Guaranteed Profit = Rs 15,000 (Guaranteed by A)
But, C’s Actual Profit Share = Rs 12,500
This implies that there is deficiency of Rs 2,500 in C’s profit share
This deficiency is to be borne by A alone.
Therefore,
A’s New Profit Share = 31,250 – 2,500 = Rs 28,750
Page No 1.76:
Question 71:
Profit and Loss Appropriation Account for the year ended March 31, 2013 |
||||
Dr. |
|
|
|
Cr. |
Particulars |
|
Amount Rs |
Particulars |
Amount Rs |
Interest on Capital to: |
|
|
Profit and Loss A/c (Net Profit) |
79,500 |
A |
8,000 |
|
|
|
B |
5,000 |
|
|
|
C |
4,000 |
17,000 |
|
|
Profit transferred to: |
|
|
|
|
A |
28,750 |
|
|
|
B |
18,750 |
|
|
|
C |
15,000 |
62,500 |
|
|
|
|
79,500 |
|
79,500 |
|
|
Working Notes:
Profit available for distribution = 79,500 – 17,000 = Rs 62,500
Profit sharing ratio = 5 : 3 : 2
C’s Minimum Guaranteed Profit = Rs 15,000 (Guaranteed by A)
But, C’s Actual Profit Share = Rs 12,500
This implies that there is deficiency of Rs 2,500 in C’s profit share
This deficiency is to be borne by A alone.
Therefore,
A’s New Profit Share = 31,250 – 2,500 = Rs 28,750
Answer:
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
54,000 |
|
A |
26,400 |
|
|
|
B |
17,600 |
|
|
|
C |
10,000 |
54,000 |
|
|
|
54,000 |
|
54,000 |
|
|
|
|
|
Working Note
C will get higher of the two:
(i) Share of Profit as per profit sharing ratio, i.e.,
(ii) Minimum guaranteed profit, i.e. Rs 10,000
Thus from net profit of Rs 54,000, minimum guaranteed profit to C of Rs 10,000 is to be adjusted first.
And the balance profit of Rs 44,000 (54,000 – 10,000) is to be shared by A and B in the ratio 3:2
Page No 1.76:
Question 72:
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
54,000 |
|
A |
26,400 |
|
|
|
B |
17,600 |
|
|
|
C |
10,000 |
54,000 |
|
|
|
54,000 |
|
54,000 |
|
|
|
|
|
Working Note
C will get higher of the two:
(i) Share of Profit as per profit sharing ratio, i.e.,
(ii) Minimum guaranteed profit, i.e. Rs 10,000
Thus from net profit of Rs 54,000, minimum guaranteed profit to C of Rs 10,000 is to be adjusted first.
And the balance profit of Rs 44,000 (54,000 – 10,000) is to be shared by A and B in the ratio 3:2
Answer:
Profit and Loss Appropriation Account for the year ended 2008–09 |
||||
Dr. | Cr. | |||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
40,000 |
|
A’s Capital A/c |
19,500 |
|
|
|
B’s Capital A/c |
15,500 |
|
|
|
C’s Capital A/c |
5,000 |
40,000 |
|
|
|
40,000 |
|
40,000 |
|
|
|
|
|
Working Notes:
Profit for the year = Rs 40,000
Profit sharing ratio = 5 : 4 : 1
C is given a guarantee of minimum profit of Rs 5,000
Deficiency in C’s share = 5,000 − 4,000 = Rs 1,000
This deficiency is to be borne by A and B equally.
Therefore,
Final Profit Share of A = 20,000 − 500 = Rs 19,500
Final Profit Share of B = 16,000 − 500 = Rs 15,500
Final Profit Share of C = 4,000 + 1,000 = Rs 5,000
Page No 1.76:
Question 73:
Profit and Loss Appropriation Account for the year ended 2008–09 |
||||
Dr. | Cr. | |||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
40,000 |
|
A’s Capital A/c |
19,500 |
|
|
|
B’s Capital A/c |
15,500 |
|
|
|
C’s Capital A/c |
5,000 |
40,000 |
|
|
|
40,000 |
|
40,000 |
|
|
|
|
|
Working Notes:
Profit for the year = Rs 40,000
Profit sharing ratio = 5 : 4 : 1
C is given a guarantee of minimum profit of Rs 5,000
Deficiency in C’s share = 5,000 − 4,000 = Rs 1,000
This deficiency is to be borne by A and B equally.
Therefore,
Final Profit Share of A = 20,000 − 500 = Rs 19,500
Final Profit Share of B = 16,000 − 500 = Rs 15,500
Final Profit Share of C = 4,000 + 1,000 = Rs 5,000
Answer:
Case (a)
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
30,000 |
|
A’s Capital A/c |
14,400 |
|
|
|
B’s Capital A/c |
9,600 |
|
|
|
C’s Capital A/c |
6,000 |
30,000 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
|
Working Notes:
Profit = Rs 30,000
Profit sharing ratio = 3 : 2 : 1
C is given a guarantee of minimum profit of Rs 6,000
Deficiency in C’s Profit Share = 6,000 − 5,000 = Rs 1,000
This deficiency is to be borne by A and B in their profit sharing ratio i.e. 3 : 2
Therefore,
Final Profit Share of A = 15,000 − 600 = Rs 14,400
Final Profit Share of B = 10,000 − 400 = Rs 9,600
Final Profit Share of C = 5,000 + 1,000 = Rs 6,000
Case (b)
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
30,000 |
|
A’s Capital A/c |
14,000 |
|
|
|
B’s Capital A/c |
10,000 |
|
|
|
C’s Capital A/c |
6,000 |
30,000 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
|
Working Notes:
Deficiency in C’s Profit Share = 6,000 − 5,000 = Rs 1,000
This deficiency is to be borne by A only.
Therefore,
Final Profit Share of A = 15,000 − 1,000 = Rs 14,000
Final Profit Share of B = 10,000
Final Profit Share of C = 5,000 + 1,000 = Rs 6,000
Case (c)
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
30,000 |
|
A’s Capital A/c |
15,000 |
|
|
|
B’s Capital A/c |
9,000 |
|
|
|
C’s Capital A/c |
6,000 |
30,000 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
|
Working Notes:
Deficiency in C’s Profit Share = 6,000 − 5,000 = Rs 1,000
This deficiency is to be borne by B only.
Therefore,
Final Profit Share of A = 15,000
Final Profit Share of B = 10,000 − 1,000 = Rs 9,000
Final Profit Share of C = 5,000 + 1,000 = Rs 6,000
Case (d)
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
30,000 |
|
A’s Capital A/c |
14,250 |
|
|
|
B’s Capital A/c |
9,750 |
|
|
|
C’s Capital A/c |
6,000 |
30,000 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
|
Working Notes:
Deficiency in C’s Profit Share = 6,000 − 5,000 = Rs 1,000
This deficiency is to be borne by A and B in the ratio of 3 : 1.
Therefore,
Final Profit Share of A = 15,000 − 750 = Rs 14,250
Final Profit Share of B = 10,000 − 250 = Rs 9,750
Final Profit Share of C = 5,000 + 1,000 = Rs 6,000
Page No 1.77:
Question 74:
Case (a)
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
30,000 |
|
A’s Capital A/c |
14,400 |
|
|
|
B’s Capital A/c |
9,600 |
|
|
|
C’s Capital A/c |
6,000 |
30,000 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
|
Working Notes:
Profit = Rs 30,000
Profit sharing ratio = 3 : 2 : 1
C is given a guarantee of minimum profit of Rs 6,000
Deficiency in C’s Profit Share = 6,000 − 5,000 = Rs 1,000
This deficiency is to be borne by A and B in their profit sharing ratio i.e. 3 : 2
Therefore,
Final Profit Share of A = 15,000 − 600 = Rs 14,400
Final Profit Share of B = 10,000 − 400 = Rs 9,600
Final Profit Share of C = 5,000 + 1,000 = Rs 6,000
Case (b)
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
30,000 |
|
A’s Capital A/c |
14,000 |
|
|
|
B’s Capital A/c |
10,000 |
|
|
|
C’s Capital A/c |
6,000 |
30,000 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
|
Working Notes:
Deficiency in C’s Profit Share = 6,000 − 5,000 = Rs 1,000
This deficiency is to be borne by A only.
Therefore,
Final Profit Share of A = 15,000 − 1,000 = Rs 14,000
Final Profit Share of B = 10,000
Final Profit Share of C = 5,000 + 1,000 = Rs 6,000
Case (c)
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
30,000 |
|
A’s Capital A/c |
15,000 |
|
|
|
B’s Capital A/c |
9,000 |
|
|
|
C’s Capital A/c |
6,000 |
30,000 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
|
Working Notes:
Deficiency in C’s Profit Share = 6,000 − 5,000 = Rs 1,000
This deficiency is to be borne by B only.
Therefore,
Final Profit Share of A = 15,000
Final Profit Share of B = 10,000 − 1,000 = Rs 9,000
Final Profit Share of C = 5,000 + 1,000 = Rs 6,000
Case (d)
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
30,000 |
|
A’s Capital A/c |
14,250 |
|
|
|
B’s Capital A/c |
9,750 |
|
|
|
C’s Capital A/c |
6,000 |
30,000 |
|
|
|
30,000 |
|
30,000 |
|
|
|
|
|
Working Notes:
Deficiency in C’s Profit Share = 6,000 − 5,000 = Rs 1,000
This deficiency is to be borne by A and B in the ratio of 3 : 1.
Therefore,
Final Profit Share of A = 15,000 − 750 = Rs 14,250
Final Profit Share of B = 10,000 − 250 = Rs 9,750
Final Profit Share of C = 5,000 + 1,000 = Rs 6,000
Answer:
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
75,000 |
|
A’s Capital A/c |
41,400 |
|
B’s Capital A/c |
|
B’s Capital A/c |
27,600 |
|
(Deficiency in Revenue) |
9,000 |
C’s Capital A/c |
15,000 |
84,000 |
|
|
|
84,000 |
|
84,000 |
|
|
|
|
|
Working Notes:
Deficiency in revenue guaranteed by B = 25,000 − 16,000 = Rs 9,000
∴Profit to be distributed among Partners = 75,000 + B’s deficiency in guaranteed interest
= 75,000 + 9,000 = Rs 84,000
Profit sharing ratio = 3 : 2 : 1
C is given a guarantee of minimum profit of Rs 15,000
Deficiency in C’s Profit Share = 15,000 − 14,000 = Rs 1,000
Therefore, Final Profit Share of A = 42,000 − 600 = Rs 41,400
Final Profit Share of B = 28,000 − 400 = Rs 27,600**
Final Profit Share of C =14,000 + 1,000 = Rs 15,000
** In the book, the final profit to B is given as Rs 18,600, however, as per the solution it should be Rs 27,600. The deficiency of Rs 9,000 that was guaranteed by B to the firm would not be deducted from his share as he is bearing it in form of profit.
Page No 1.77:
Question 75:
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (Net Profit) |
75,000 |
|
A’s Capital A/c |
41,400 |
|
B’s Capital A/c |
|
B’s Capital A/c |
27,600 |
|
(Deficiency in Revenue) |
9,000 |
C’s Capital A/c |
15,000 |
84,000 |
|
|
|
84,000 |
|
84,000 |
|
|
|
|
|
Working Notes:
Deficiency in revenue guaranteed by B = 25,000 − 16,000 = Rs 9,000
∴Profit to be distributed among Partners = 75,000 + B’s deficiency in guaranteed interest
= 75,000 + 9,000 = Rs 84,000
Profit sharing ratio = 3 : 2 : 1
C is given a guarantee of minimum profit of Rs 15,000
Deficiency in C’s Profit Share = 15,000 − 14,000 = Rs 1,000
Therefore, Final Profit Share of A = 42,000 − 600 = Rs 41,400
Final Profit Share of B = 28,000 − 400 = Rs 27,600**
Final Profit Share of C =14,000 + 1,000 = Rs 15,000
** In the book, the final profit to B is given as Rs 18,600, however, as per the solution it should be Rs 27,600. The deficiency of Rs 9,000 that was guaranteed by B to the firm would not be deducted from his share as he is bearing it in form of profit.
Answer:
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (before C’s salary) (10,710 + 1,800) |
12,510 |
|
A’s Capital A/c |
6,183 |
|
|
|
B’s Capital A/c |
3,825 |
|
|
|
C’s Capital A/c |
2,502 |
12,510 |
|
|
|
12,510 |
|
12,510 |
|
|
|
|
|
Working Notes:
WN 1 Salary to C = Rs 150 × 12 = Rs 1,800
WN 2
Total Amount for C (Salary and Commission) = 1,800 + 510 = Rs 2,310
WN 3 Profit before C’s Salary = 10,710 + 1,800 = Rs 12,510
WN 4 Excess of 1/5th share over Salary and Commission = 2,502 − 2,310 = Rs 192
Profit available for distribution between A and B = 12,510 − 1,800 − 510 = Rs 10,200
WN 5 A’s share of Profit after C’s deficiency = 6,375 − 192 = Rs 6,183
Page No 1.77:
Question 76:
Profit and Loss Appropriation Account |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c (before C’s salary) (10,710 + 1,800) |
12,510 |
|
A’s Capital A/c |
6,183 |
|
|
|
B’s Capital A/c |
3,825 |
|
|
|
C’s Capital A/c |
2,502 |
12,510 |
|
|
|
12,510 |
|
12,510 |
|
|
|
|
|
Working Notes:
WN 1 Salary to C = Rs 150 × 12 = Rs 1,800
WN 2
Total Amount for C (Salary and Commission) = 1,800 + 510 = Rs 2,310
WN 3 Profit before C’s Salary = 10,710 + 1,800 = Rs 12,510
WN 4 Excess of 1/5th share over Salary and Commission = 2,502 − 2,310 = Rs 192
Profit available for distribution between A and B = 12,510 − 1,800 − 510 = Rs 10,200
WN 5 A’s share of Profit after C’s deficiency = 6,375 − 192 = Rs 6,183
Answer:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
A’s Capital A/c |
Dr. |
|
8,500 |
|
To B’s Capital A/c |
|
|
4,500 |
|
To C’s Capital A/c |
|
|
4,000 |
|
(Profit and loss adjusted) |
|
|
|
|
|
|
|
|
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||
Dr. | Cr. | |||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Salary to: |
|
Profit and Loss A/c |
90,000 |
|
A |
1,500 |
|
|
|
B |
1,500 |
3,000 |
|
|
Commission to B |
4,500 |
|
|
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
35,000 |
|
|
|
B’s Capital A/c |
28,500 |
|
|
|
C’s Capital A/c |
19,000 |
82,500 |
|
|
|
90,000 |
|
90,000 |
|
|
|
|
|
Working Notes:
WN 1 Wrong Distribution of Profit in the ratio of 3 : 2 : 1
WN 2 Calculation of Right Profit Share of each Partner (3 : 3 : 2)
Profit available for distribution = 90,000 − 3,000 − 4,500
= Rs 82,500
A’s minimum guaranteed profit share = Rs 35,000
∴Deficiency in A’s Profit Share = 35,000 − 30,937.50 = Rs 4,062.50
This deficiency is to be borne by B and C in their profit sharing ratio i.e. 3 : 2
Therefore,
Final Profit Share of A = 30,937.50 + 4,062.50= Rs 35,000
Final Profit Share of B = 30,937.50 − 2,437.50 = Rs 28,500
Final Profit Share of C =20,625 − 1,625 = Rs 19,000
WN 3
Statement Showing Adjustment |
||||
Particulars |
A |
B |
C |
Total |
Salary (to be credited) |
1,500 |
1,500 |
- |
3,000 |
Commission (to be credited) |
|
4,500 |
|
4,500 |
Share of Profit (to be credited) |
35,000 |
28,500 |
19,000 |
82,500 |
Right distribution |
36,500 |
34,500 |
19,000 |
90,000 |
Wrong Distribution of Rs 40,000 (3:2:1) |
(45,000) |
(30,000) |
(15,000) |
(90,000) |
Net Effect |
(8,500) |
4,500 |
4,000 |
NIL |
|
|
|
|
|
Page No 1.77:
Question 77:
Journal |
||||
Particulars |
L.F. |
Debit Amount Rs |
Credit Amount Rs |
|
A’s Capital A/c |
Dr. |
|
8,500 |
|
To B’s Capital A/c |
|
|
4,500 |
|
To C’s Capital A/c |
|
|
4,000 |
|
(Profit and loss adjusted) |
|
|
|
|
|
|
|
|
Profit and Loss Appropriation Account for the year ended March 31, 2014 |
||||
Dr. | Cr. | |||
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Salary to: |
|
Profit and Loss A/c |
90,000 |
|
A |
1,500 |
|
|
|
B |
1,500 |
3,000 |
|
|
Commission to B |
4,500 |
|
|
|
Profit transferred to: |
|
|
|
|
A’s Capital A/c |
35,000 |
|
|
|
B’s Capital A/c |
28,500 |
|
|
|
C’s Capital A/c |
19,000 |
82,500 |
|
|
|
90,000 |
|
90,000 |
|
|
|
|
|
Working Notes:
WN 1 Wrong Distribution of Profit in the ratio of 3 : 2 : 1
WN 2 Calculation of Right Profit Share of each Partner (3 : 3 : 2)
Profit available for distribution = 90,000 − 3,000 − 4,500
= Rs 82,500
A’s minimum guaranteed profit share = Rs 35,000
∴Deficiency in A’s Profit Share = 35,000 − 30,937.50 = Rs 4,062.50
This deficiency is to be borne by B and C in their profit sharing ratio i.e. 3 : 2
Therefore,
Final Profit Share of A = 30,937.50 + 4,062.50= Rs 35,000
Final Profit Share of B = 30,937.50 − 2,437.50 = Rs 28,500
Final Profit Share of C =20,625 − 1,625 = Rs 19,000
WN 3
Statement Showing Adjustment |
||||
Particulars |
A |
B |
C |
Total |
Salary (to be credited) |
1,500 |
1,500 |
- |
3,000 |
Commission (to be credited) |
|
4,500 |
|
4,500 |
Share of Profit (to be credited) |
35,000 |
28,500 |
19,000 |
82,500 |
Right distribution |
36,500 |
34,500 |
19,000 |
90,000 |
Wrong Distribution of Rs 40,000 (3:2:1) |
(45,000) |
(30,000) |
(15,000) |
(90,000) |
Net Effect |
(8,500) |
4,500 |
4,000 |
NIL |
|
|
|
|
|
Answer:
Profit and Loss Appropriation Account for the year and March 31,2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
2,25,000 |
|
A’s Capital A/c |
96,750 |
|
|
|
B’s Capital A/c |
72,000 |
|
|
|
C’s Capital A/c |
56,250 |
2,25000 |
|
|
|
2,25000 |
|
2,25000 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Remuneration to C as a Manager
Salary to C = Rs 27,000
Commission to C = 10% of Net Profit after Salary and Commission
Net Profit after Salary and Commission = 2,25,000 − 27,000
= Rs 1,98,000
C’s remuneration as Manager = Salary + Commission = 27,000 + 18,000
= Rs 45,000
WN 2 Calculation of Profit Share of C as a Partner
Profit = Rs 2,25,000
Part of C’s Profit Share to be borne by A = 56,250 − 45,000 = Rs 11,250
Profit available for distribution between A and B = 2,25,000 − 45,000
= Rs 1,80,000
A’s Profit share after adjusting C’s deficiency = 1,08,000 − 11,250 = Rs 96,750
Page No 1.78:
Question 78:
Profit and Loss Appropriation Account for the year and March 31,2014 |
||||
Dr. |
|
|
Cr. |
|
Particulars |
Amount Rs |
Particulars |
Amount Rs |
|
Profit transferred to: |
|
Profit and Loss A/c |
2,25,000 |
|
A’s Capital A/c |
96,750 |
|
|
|
B’s Capital A/c |
72,000 |
|
|
|
C’s Capital A/c |
56,250 |
2,25000 |
|
|
|
2,25000 |
|
2,25000 |
|
|
|
|
|
Working Notes:
WN 1 Calculation of Remuneration to C as a Manager
Salary to C = Rs 27,000
Commission to C = 10% of Net Profit after Salary and Commission
Net Profit after Salary and Commission = 2,25,000 − 27,000
= Rs 1,98,000
C’s remuneration as Manager = Salary + Commission = 27,000 + 18,000
= Rs 45,000
WN 2 Calculation of Profit Share of C as a Partner
Profit = Rs 2,25,000
Part of C’s Profit Share to be borne by A = 56,250 − 45,000 = Rs 11,250
Profit available for distribution between A and B = 2,25,000 − 45,000
= Rs 1,80,000
A’s Profit share after adjusting C’s deficiency = 1,08,000 − 11,250 = Rs 96,750
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
|
Cr. |
Particulars |
|
Amount Rs |
Particulars |
Amount Rs |
Interest on Capital to: |
|
|
Profit and Loss A/c (Net Profit) |
4,24,000 |
Asgar |
48,000 |
|
|
|
Chaman |
40,000 |
|
|
|
Dholu |
32,000 |
1,20,000 |
|
|
Salary to Chaman (Rs 7,000 × 12) |
84,000 |
|
|
|
Salary to Dholu (Rs 10,000 × 4) |
40,000 |
|
|
|
Profit transferred to: |
|
|
|
|
Asgar |
70,000 |
|
|
|
Chaman |
40,000 |
|
|
|
Dholu |
70,000 |
1,80,000 |
|
|
|
|
4,24,000 |
|
4,24,000 |
|
|
Working Notes:
Profit available for distribution = 4,24,000 – (1,20,000 + 84,000+ 40,000) = Rs 1,80,000
Profit sharing ratio = 4 : 2 : 3
Dholu’s Minimum Guaranteed Profit = Rs 1,10,000 (excluding interest on capital, but including salary)
Dholu’s Minimum Guaranteed Profit (excluding salary) = 1,10,000 – 40,000 = Rs 70,000
But, Dholu’s Actual Profit Share = Rs 60,000
Deficiency in Dholu’s Profit Share = 70,000 – 60,000 = 10,000
This deficiency is to be borne by Asgar alone.
Therefore,
Asgar’s New Profit Share = 80,000 – 10,000 = Rs 70,000
Page No 1.78:
Question 79:
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
|
Cr. |
Particulars |
|
Amount Rs |
Particulars |
Amount Rs |
Interest on Capital to: |
|
|
Profit and Loss A/c (Net Profit) |
4,24,000 |
Asgar |
48,000 |
|
|
|
Chaman |
40,000 |
|
|
|
Dholu |
32,000 |
1,20,000 |
|
|
Salary to Chaman (Rs 7,000 × 12) |
84,000 |
|
|
|
Salary to Dholu (Rs 10,000 × 4) |
40,000 |
|
|
|
Profit transferred to: |
|
|
|
|
Asgar |
70,000 |
|
|
|
Chaman |
40,000 |
|
|
|
Dholu |
70,000 |
1,80,000 |
|
|
|
|
4,24,000 |
|
4,24,000 |
|
|
Working Notes:
Profit available for distribution = 4,24,000 – (1,20,000 + 84,000+ 40,000) = Rs 1,80,000
Profit sharing ratio = 4 : 2 : 3
Dholu’s Minimum Guaranteed Profit = Rs 1,10,000 (excluding interest on capital, but including salary)
Dholu’s Minimum Guaranteed Profit (excluding salary) = 1,10,000 – 40,000 = Rs 70,000
But, Dholu’s Actual Profit Share = Rs 60,000
Deficiency in Dholu’s Profit Share = 70,000 – 60,000 = 10,000
This deficiency is to be borne by Asgar alone.
Therefore,
Asgar’s New Profit Share = 80,000 – 10,000 = Rs 70,000
Answer:
Profit and Loss Appropriation Account for the year ended March 31, 2012 |
||||
Dr. |
|
|
|
Cr. |
Particulars |
|
Amount Rs |
Particulars |
Amount Rs |
Interest on Capital to: |
|
|
Profit and Loss A/c (Net Profit) |
9,50,000 |
Ankur |
84,000 |
|
|
|
Bhavna |
36,000 |
|
|
|
Disha |
24,000 |
1,44,000 |
|
|
Salary to Bhavna |
50,000 |
|
|
|
Commission to Disha (Rs 3,000 × 12) |
36,000 |
|
|
|
Profit transferred to: |
|
|
|
|
Ankur |
4,14,000 |
|
|
|
Bhavna |
1,80,000 |
|
|
|
Disha |
1,26,000 |
7,20,000 |
|
|
|
|
9,50,000 |
|
9,50,000 |
|
|
Working Notes:
Profit available for distribution = 9,50,000 – (1,44,000 + 50,000 + 36,000) = Rs 7,20,000
Profit sharing ratio = 7 : 3 : 2
Bhavna’s Minimum Guaranteed Profit = Rs 1,70,000 (excluding interest on capital)
But, Bhavna’s Actual Profit Share = Rs 1,80,000
This implies that there is no deficiency in Bhavna’s profit share as her actual profit share (i.e. Rs 1,80,000) exceeds his minimum guaranteed profit share (i.e. Rs 1,70,000).
Disha’s Minimum Guaranteed Profit = Rs 1,50,000 (including interest on capital but excluding salary)
Disha’s Minimum Guaranteed Profit (excluding interest) = 1,50,000 – 24,000 = Rs 1,26,000
But, Disha’s Actual Profit Share = 1,20,000
Deficiency in Disha’s Profit Share = 1,26,000 – 1,20,000 = 6,000
This deficiency is to be borne by Ankur alone.
Therefore,
Ankur’s New Profit Share = 4,20,000 – 6,000 = Rs 4,14,000
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