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Explain this question of elasticity of demand

Dear Student 
An increase in the price of good will increase demand for its substitute goods and decrease in price of goods  will decrease the demand of substitute goods. It is also known as cross elasticity of demand. 

If price rise of goods, demand of substitute goods will rise :-
  • Demand of Close substitute will increase little (low elasticity)
  • Demand of Perfect substitute will increase more (high elasticity)
  • Demand of not so close substitute will not have any impact
Regards 

 

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6- The capital accounts of Asif and Benny stood at ` 30,000 and ` 40,000 respectively after
the necessary adjustments in respect of drawings and net profit for the year ended 31st
March, 2016. It was subsequently ascertained that interest on capital @ 10 % per annum
and interest on drawings @ 5 % per annum were not taken into account in arriving at the
divisible profits for the year.
The drawings of the partners had been : Asif ` 1,200 drawn at the end of each half year
and Benny ` 1,200 drawn at the end of each quarter.
The net profit for the year amounted to ` 20,000. The partners share profits and losses in
the ratio of 3:2.
You are required to :
i. Pass the necessary journal entries to rectify the lapse in accounting.
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