Q. On 31st Mar 2017, Capital A/C bal. after making adjustment of profits and drawings of Ekta, Ankit and Chahat are 150000, 210000 and 270000 respectively. Subsequently it was discovered that int. 0f cap. and draw. has been ommitted.
- profit of 31st Mar 2017 was 120000
- During the year Ekta withdrew Rs. 24000 an d Ankit and Chahat each withdraw a sum of Rs. 24000 in equal instalment in the middle of each quarter.
- The int. on draw. - 5% p.a. and int. of cap. - 10% p.a
- Profit sharing ration 1:2:3
Showing working notes , pass the necessary journal entries
Dear Student,
Workings:
a) Profit of 1,20,000 was shared in ratio of 1:2:3
b) Interest on Capital on
Ekta's Capital =
Ankit's Capital =
Chaht's Capital A/c =
c) Interest on Drawings on
Ekta's Capital =
Ankit's & Chahat's Capital =
d) Final Profit =
| Date | Particulars | LF | Amount (in Rs) | Amount (in Rs) |
| Chahat's Capital A/c | Dr | 5,400 | ||
| To Ekta's Capital A/c | 5,400 | |||
| (Rectification entry passed) | ||||
Workings:
| Particulars | Ekta's Capital A/c | Ankit's Capital A/c | Chahat's Capital A/c | Firm |
| Profits wrongly distributed | 20,000 (Dr) | 40,000 (Dr) | 60,000 (Dr) | 1,20,000 (Cr) |
| Interest on Capital | 17,400 (Cr) | 23,400 (Cr) | 29,400 (Cr) | 70,200 (Dr) |
| Interest on Drawings | 600 (Dr) | 600 (Dr) | 600 (Dr) | 1,800 (Cr) |
| Remaining profit to be distributed in 1:2:3 | 8,600 (Cr) | 17,200 (Cr) | 25,800 (Cr) | 51,600 (Dr) |
| Net effect | 5,400 (Cr) | -- | 5,400 (Dr) | NIL |
a) Profit of 1,20,000 was shared in ratio of 1:2:3
b) Interest on Capital on
Ekta's Capital =
Ankit's Capital =
Chaht's Capital A/c =
c) Interest on Drawings on
Ekta's Capital =
Ankit's & Chahat's Capital =
d) Final Profit =