A and B are partners. A's Capital is Rs.1,00,000 and B's Capital is Rs.60,000. Interest on capital is payable @ 6% p.a. B is entitled to a salary of Rs.3,000 per month. Profit for the current year before interest and salary to B is Rs.80,000. Prepare Profit and Loss Appropriation Account.
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Profit and Loss Appropriation a/c
( for the year ended......) Dr. Cr.
To Interest on capital - A - B
By Profit a/c (before interest and salary)
To Salary to B (3000*12)
To Profit transferred to: - A's Capital a/c - B's Capital a/c