Dear Student Profit and Loss Appropriation A/c Date Particulars Amount Date Particulars Amount (Rs) (Rs) Interest on Loan Lokesh (1,00,000 x 10%) 10,000 Rent : Net profit 180,000 Paras 25,000 Lokesh - Interest on Drawings 25,000 Paras (40,000 x 5% x 6/12) 1,000 Lokesh (30,000 x 5% x 6/12) 750 Commission : - 1,750 Paras - Lokesh (7,00,000 x 1%) 7,000 7,000 Interest on Capital : Paras (1,50,000 x 5%) 7,500 Lokesh (1,40,000 x 5%) 7,000 14,500 Profit Transferred : Paras 62,625 Lokesh 62,625 125,250 181,750 181,750 Interest on Drawings is charged for an Average period of 6 months Regards

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Please solve this Paras and Lokesh are partners in the firm, agreed to appropriate the profits of their firm on the following terms: (a) (b) (c) (d) (e) (f) Interest is payable on capital @ 5 % p.a. Paras on loan to be given by the firm to the partners @ 10 % p.a. Interest on loan to be given by the firm to the partners @ 10 % pa. Interest on drawings charged from the partners @ 5% p.a. Lokesh will get commission @ 1 % on the sales made during the year. Paras is entitled to rent Rs. 25,000 p.a. for allowing the firm to carry on the business in his premises. The net profit and sales of the firm for the year ended 31st March, 2016 w I before above adjustments and respectively. Other par ticulars were : Capital balance on 01.()4.2015 Loan advanced on 01.10.2015 Drawings made during the year Paras 150,000 40,000 Lokesh 30,000 Prepare Profit and Loss Appropriation A/c for year 2015-16 from the abov transactions.

Dear Student

Profit and Loss Appropriation A/c

Date	Particulars		Amount	Date	Particulars		Amount
			(Rs)				(Rs)

	Interest on Loan

	Lokesh (1,00,000 x 10%)		10,000


	Rent :				Net profit		180,000
	Paras	25,000
	Lokesh	-			Interest on Drawings
			25,000		Paras (40,000 x 5% x 6/12)	1,000
					Lokesh (30,000 x 5% x 6/12)	750
	Commission :					-	1,750
	Paras	-
	Lokesh (7,00,000 x 1%)	7,000
			7,000

	Interest on Capital :
	Paras (1,50,000 x 5%)	7,500
	Lokesh (1,40,000 x 5%)	7,000
			14,500

	Profit Transferred :
	Paras	62,625
	Lokesh	62,625
			125,250




			181,750				181,750

Interest on Drawings is charged for an Average period of 6 months.

Regards

-6

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