Question

A and B are partners sharing profits and losses in the ratio of 3 2. They invested capitals of ₹1,00,000 and ₹50,000 respectively. Compute interest on capital and show distribution of profits in concerned a+c in each of the following cases - i. If the partnership deed is silent and profits for the year are ₹8,000. ii. If the partnership deed provides for Interest on Capital @ 5+ p.a. and profits for the year are ₹7,500. iii. If the partnership deed provides for Interest on Capital @ 5+ p.a. and profits for the year are ₹9,000. iv. If the partnership deed provides for Interest on Capital @ 5+ p.a. and losses for the year are ₹6,000. v. If the partnership deed provides for Interest on Capital @ 5+ p.a. and profits for the year are ₹3,000. vi. If the partnership deed provides for Interest on Capital @ 5+ p.a. even if it involves the firm in loss and profits for the year are ₹5,000. vii. If the partnership deed is silent and losses for the year are ₹6,000.

Answer 1

Dear student
(i) Profit and loss appropraition A/c
for the year ended.....
Dr. Cr.

particular	amount(rs)	particular	amount(rs)
To profit transferred to capital A/c A= (8,000 X 3/5)=4800 B= (8,000 x 2/5)= RS 3200	8,000	By profit and loss A/c - net profit	8,000
	8,000		8,000

note: no, interest on capital is paid if partnership deed is silent.
(ii) profit and loss appropriation A/c
for the year ended ..........
Dr. Cr.

particulars	amount(rs)	particulars	amount(rs)
To interest on capital A/c A = (1,00,000 X 5/100) = 5000 B = (50,000 x 5/100)= RS 2,500	7,500	By profit and loss A/c-net profit	7,500
	7,500		7,500

(iii) Profit and loss appropriation A/c
for the year ended .................
Dr. Cr.

particular	amount	particular	amount(rs)
To interest on capital A/c A= (1,00,000 X 5/100)=5,000 B = (50,000 x 5/100)= 2500	7500	By profit and loss A/c - net profit	9,000
To profit transferred to capital A/c A= 1500x 3/5= RS 900 B = 1500 X 2/5= rs 600	1500
	9000		9000

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