Please solve it soon . Urgently required for tomorrow.

Please solve it soon . Urgently required for tomorrow. when Manager is Treated ab tnc Firm with Retrospective Effect N 'haring profits and losses in the ratio oi They salary Of 7,500 pet month, Z had deposited 2.00000 At the end of the accounting year (i.e., 31st March. div.',inn it was decided that Z should be treated a partne: effect from A.-„-, 1 '6th share of profits, his deposit being considered as cavete' of other partners. The firm's profits and losses an Profit 2013-14: profit 526.000: 2014. '5t ao.ooo and }ournai entries to give effect to the above. On is to be allowed as a charge. (Ans.: x by e 3,600, Y by and Credit z by a Manage' for 4 years - 360.000 • 72000 (Interest) = 3,90.000 (Share of profit) -f 48,000 (Interest on Capitan : 4,38.000.1 "omitted a Partner and Guarantee of Profit in [he ratio of 2 1. They decided to admit C. thew manager. a him 1,'5th of profit. C. while manager. getting a o'

Dear Student,

Journal

Particulars

L.F.

Debit

Amount

Rs

Credit

Amount

Rs

Z’s Loan A/c

Dr.

 

2,00,000

 

To Z’s Capital A/c

 

 

2,00,000

(Z’s Loan transferred to his Capital Account)          

 

 

 

 

 

 

 

X’s Capital A/c

Dr.

 

3,600

 

Y’s Capital A/c

Dr.

 

2,400

 

To Z’s Capital A/c

 

 

6,000

(Z's excess credit balance paid to him by X and Y in the ratio of 3:2)

 

 

 

 

 

 

 


Working Notes:

WN 1 Profit before Z’s Salary and Interest on Loan.

Year

Profit/

Loss

+

Salary

+

Interest on Z’s loan

=

Profit before Z’s 

 Salary and Interest on Loan

2012-2013

5,90,000

+

90,000

+

18,000

=

6,98,000

2013-2014

6,26,000

+

90,000

+

18,000

=

7,34,000

2014-2015

(40,000)

+

90,000

+

18,000

=

68,000

2015-2016

7,80,000

+

90,000

+

18,000

=

8,88,000

Profit before Interest on Z’s Capital (for 4 years)

23,88,000

 

 


WN 2 Calculation of Interest on Capital


Interest on Z’s Capital for 4 years = 12,000 × 4 = Rs 48,000

WN 3 Calculation of Z’s Share of Profit as a Partner

Profit after Interest on Z’s Capital = Profit before Interest on Z’s Capital − Interest on Z’s Capital

= 23,88,000 − 48,000 = Rs 23,40,000

Z’s Profit Share as a Partner for 4 years


∴Z’s Share of Interest on Capital and Profit Share as a Partner = 48,000 + 3,90,000 = Rs 4,38,000

Z’s Salary and Interest on Loan as Manager = 72,000 + 3,60,000 = Rs 4,32,000

Adjustment of Z's share of Profit

Z’s Share as a Partner

Less: Z’s Share as a Manager

Z will get from X and Y in their profit sharing ratio

 

4,38,000

(4,32,000)

   6,000

 

Profit to be transferred by X and Y in favour of Z

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