R and S were partners in a firm sharing profits in 3:2 ratio. their respective fixed capitals were rs. 10,00,000 and 15,00,000. the partnership deed provided the following:

1) interest on capital @10% p.a.

2) interest on drawing @12% p.a.

During the year ended 31-03-2007, R's drawings were rs. 1000 p.m. drawn at the end of every month and S's drawings were rs.2000 p.m. drwan in the beginning of every month. After the preparation of final accounts for the year ended 31-03-2007 it was discovered that interest on R's drawings was not taken into consideration.

Calculate interest on R's drawings and give necessary adjusting entry for the same.

Dear Student, the solution of your query is here;

Journal

Date

Particulars

L.F.

Debit

Amount

(Rs)

Credit

Amount

(Rs)

 

 

 

 

 

 

 

R’s Current A/c

Dr.

 

264

 

 

  To S’s Current A/c

 

 

 

264

 

(R’s interest on drawings has not been given, now adjusting entry has been passed)

 

 

 

 

 

 

 

 

 

 

Adjusting Table:

Particulars

R

S

Total

Interest on R’s Drawings (Dr.)

660

 

660

Profit to be shared in the ratio 3:2 (Cr.)

396

264

660

 

264 (Dr.)

264 (Cr.)

Nil

 

Working Notes:

Calculation of R's Drawings:

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