DK Goel Accountancy Class 12 Solutions Chapter 1 Accounting for Partnership Firms – Fundamentals which is outlined by expert Accountancy teachers from the latest version of DK Goel Accountancy Class 12 textbook solutions. We at BYJU’S provide DK Goel Solutions to assist students to comprehend all the theories in particular. There are numerous concepts in Accountancy, but the concepts of Admission of a partner, Accounting Ratios and Cash Flow Statement (As per AS – 3 Revised) is required.
DK Goel Solutions Class 12 – Chapter 1 – Part A
Question 1
A and B are partners in a farm. A is entitled to a salary of ₹15,000 p.m and a commission of 10% of net profit before charging any commission. B is entitled to a commission of 10% of net profit after charging his commission. Net profit till 31st March 2018 was ₹4,40,000. Show the distribution of profit.
Solution:
| Dr. | Profit and Loss of Appropriate Account
Till 31st March, 2018 |
Cr. | |
| Particulars | ₹ | Particulars | ₹ |
| To A’s Salary | 1,80,000 | By Profit & Loss A/c (Net Profit) | 4,40,000 |
| To A’s Commission
(₹4,40,000 x 10/100) |
44,000 | ||
| To B’s Commission
(₹4,40,000 x 10/110) |
40,000 | ||
| To Profit transferred to: | |||
| A’s Capital A/c 88,000
B’s Capital A/c 88,000 |
1,76,000 | ||
| 4,40,000 | 4,40,000 | ||
Question 2
X, Y, and Z are partners sharing profits and losses in the ratio 3:2:1. After the final accounts have been prepared, it discovered that interest in drawings@5% p.a had not been taken into consideration. The drawings of the partners were: X ₹1,50,000, Y ₹1,26,000 , Z ₹1,20,000. Prepare a journal entry.
Solution:
Calculation of Interest on Drawings:
Since the date of the drawing is not given, interest will be charged for 6 months.
X: 5% on ₹1,50,000 for 6 months = ₹ 3,750
Y: 5% on ₹1,26,000 for 6 months = ₹ 3,150
Z: 5% on ₹1,20,000 for 6 months = ₹ 3,700
₹ 9,900
| Table Showing Adjustments | |||||
| X (₹) | Y (₹) | Z (₹) | Total | ||
| Interest on Drawings
Division of ₹5,400 in 3:2:1 |
Dr.
Dr. |
2,550
2,700 |
1,850
1,850 |
1,000
900 |
5,400
5,400 |
| Difference | Cr.150 | Dr. 50 | DR.100 | ——– | |
Hence, the adjusting entry will be:
| Journal Entry | |||||
| Date | Particulars | L.F | Dr. ₹ | Cr. ₹ | |
| Y’s Capital A/c
Z’s Capital A/c |
Dr.
Dr. |
50
100 |
|||
| To X’s Capital A.c
(Adjustment in respect of interest on drawing omitted in previous year’s account) |
150 | ||||
Question 3
Akshara and Samiksha are partners. Business is carried from the property owned by Akshara on a monthly rent of ₹5,000. Akshara is entitled to a salary of ₹40,000 per quarter and Samiksha get a commission of 4% on net sales, which during the year was ₹5,00,000. Net profit till 31st March, 2018 before providing for rent was ₹6,00,000
Prepare a profit and loss appropriate account till 31st March 2018.
Solution:
| Dr. | Profit and Loss Appropriate Account
Till 31st March, 2018 |
Cr. | |
| Particulars | ₹ | Particulars | ₹ |
| To Salary to Akshara
To commission to Samiksha |
1,60,000
2,00,000 |
By Profit & Loss A/c (Net Profit)
( ₹6,00,00 – ₹60,000) |
5,40,000 |
| To Profit transferred to: | |||
| Akshara’s Capital A/c 90,000
Samiksha’s Capital A/c 90,000 |
1,80,000 | ||
| 5,40,000 | 5,40,000 | ||
*Rent paid to a partner is a charge against profits. It will be debited to the Profit & Loss Account.
Question 4
Ravi and Mohan were partners in a firm sharing profits in the ratio of 7:5. Their respective fixed capitals were Ravi ₹10,00,000 and Mohan ₹7,00,000. The partnership deed provided for the following:
- Interest on Capital @ 12% pa.
- Ravi’s salary ₹6,000 per month and Mohan’s salary ₹60,000 per year.
The profit till March 31-3-2019 was ₹5,04,000 which was distributed equally, without providing for the above. Record an adjustment entry.
Solution:
| Statement of Adjustments | ||||
| Ravi (₹) | Mohan (₹) | Total (₹) | ||
| Interest on Capitals | Cr. | 1,20,000 | 84,000 | 2,04,000 |
| Salary | Cr. | 72,000 | 60,000 | 1,32,000 |
| Profit left* after authorizing interest on capital and salary will be ₹5,04,000 – ₹2,04,000 – ₹1,32,000 = ₹1,68,000. The profit sharing ration will be divided into, i.e, 7:5 | 98,000 | 70,000 | 1,68,000 | |
| Net amount that should have been received | Cr. | 2,90,000 | 2,14,000 | 5,04,000 |
| Less: Profit already distributed equally | Dr. | 2,52,000 | 2,52,000 | 5,04,000 |
| Net Effect | (Cr.) 38,000 | (DR.) 38,000 | ———– | |
*Remaining profit will have to be calculated when profit has already been distributed in wrong profit sharing ratio.
Stay tuned to BYJU’S for more DK Goel solutions, question papers, sample papers, syllabus and Commerce notifications.
| DK Goel Accountancy Solutions Class 12 – Part A (Chapter wise) | ||
| Chapter 2 Change in Profit Sharing Ratio Among the Existing Partners | Chapter 3 Admission of a partner | |
| Chapter 4 Retirement or Death of a Partner | Chapter 5 Dissolution of a Partnership Firm | |
| Important Topics in Accountancy: |
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