Ajay and Vijay are partners in a firm. They share profits in the ratio of 3:2. As per their partnership agreement, interest on drawings is to be charged @ 10% p.a. Their drawings during 2017 were Rs 24,000 and Rs 16,000, respectively. Calculate interest on drawings based on the assumption that the amounts were withdrawn evenly, throughout the year.

Rs 1,200 and Rs 800

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Rs 1,500 and Rs 900

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Rs 1,800 and Rs 1,200

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Rs 1,000 and Rs 600

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Solution

The correct option is A Rs 1,200 and Rs 800
Interest on Drawings = Amount withdrawn x rate of interest x 6/12 (evenly)
AJAY:-
= 24,000 x 10/100 x 6/12
= RS-1,200.

VIJAY:-
= 16,000 x 10/100 x 6/12
= RS-800.

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Similar questions

B,V and M were in partnership sharing profits and losses in the ratio of 3 : 2 : 1. Their fixed capitals were Rs 5,00,000; Rs 4,00,000 and Rs 3,00,000 respectively. The partnership deed provided for the following :

(i) Interest on capital @ 6 $%$ p.a.

(ii) Salary of Rs 40,000 to M

(iii) Interest on partners drawings will be charged @ 12 $%$ p.a.

During the year ended 31st March, 2018 the firm earned a profit of Rs 2,70,000. Interest on drawings were Rs 1,200, Rs 720 and Rs 450 respectively. Prepare Profit and Loss Appropriation Account for the year ending on March 31st 2018.

Q. Ram and Mohan are partners in a business. Their capitals at the end of the year were Rs. 24,000 and Rs. 18,000 respectively. During the year, Ram's drawings and Mohan's drawings were Rs. 4,000 and Rs. 6,000 respectively. Profit (before charging interest on capital) during the year was Rs. 16,000. Calculate interest on capital @ 5% p.a. for the year ended 31st March, 2018.

Mohan, Vijay and Anil are partners, the balance on their capital accounts being Rs 30,000, Rs 25,000 and Rs 20,000 respectively. In arriving at these figures, the profits for the year ended March 31, 2017 amounting to Rupees 24,000 had been credited to partners in the proportion in which they shared profits. During the tear their drawings for Mohan, Vijay and Anil were Rs 5,000, Rs 4,000 and Rs 3,000, respectively. Subsequently, the following omissions were noticed:

(a)	Interest on Capital, at the rate of 10% p.a., was not charged.
(b)	Interest on Drawings: Mohan Rs 250, Vijay Rs 200, Anil Rs 150 was not recorded in the books.

Record necessary corrections through journal entries.

Mohan, Vijay and Anil are partners, the balance on their capital accounts being Rs 30,000, Rs 25,000 and Rs 20,000 respectively. In arriving at these figures, the profits for the year ended March 31, 2007 amounting to Rs 24,000 had been credited to partners in the proportion in which they shared profits. During the year their drawings for Mohan, Vijay and Anil were Rs 5,000, Rs 4,000 and Rs 3,000 respectively. Subsequently, the following omissions were noticed

(a) Interest on Capital, at the rate of 10% pa, was not charged.

(b) Interest on Drawings Mohan Rs 250, Vijay Rs 200, Anil Rs 150 was not recorded in the books.

Record necessary corrections through journal entries.

Ramesh and Suresh were partners in a firm sharing profits in the ratio of their capitals contributed on commencement of business which were Rs 80,000 and Rs 60,000 respectively. The firm started business on April 1, 2016. According to the partnership agreement, interest on capital and drawings are 12% and 10% p.a., respectively. Ramesh and Suresh are to get a monthly salary of Rs 2,000 and Rs 3,000, respectively.
The profits for year ended March 31, 2017 before making above appropriations was Rs 1,00,300. The drawings of Ramesh and Suresh were Rs 40,000 and Rs 50,000, respectively. Interest on drawings amounted to Rs 2,000 for Ramesh and Rs 2,500 for Suresh. Prepare Profit and Loss Appropriation Account and partners’ capital accounts, assuming that their capitals are fluctuating.

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The correct option is A Rs 1,200 and Rs 800Interest on Drawings = Amount withdrawn x rate of interest x 6/12 (evenly)AJAY:-= 24,000 x 10/100 x 6/12= RS-1,200.VIJAY:-= 16,000 x 10/100 x 6/12= RS-800.

The correct option is A Rs 1,200 and Rs 800
Interest on Drawings = Amount withdrawn x rate of interest x 6/12 (evenly)
AJAY:-
= 24,000 x 10/100 x 6/12
= RS-1,200.

VIJAY:-
= 16,000 x 10/100 x 6/12
= RS-800.