You visited us 1 times! Enjoying our articles? Unlock Full Access!

Byju's Answer

Standard VIII

Mathematics

Prices / Charges Related to Buying and Selling

Anita and Ank...

Question

Anita and Ankita are partners sharing profits equally. Their capitals, maintained following Fluctuating Capital Accounts Method, as on 31st March, 2017 were $R s .5, 00, 000$ and $R s . 4, 00, 000$ respectively. Partnership Deed provided to allow interest on capital @ 10% p.a.The firm earned net profit of $R s . 2, 00, 000$ for the year ended 31st March, 2018.
Pass the Journal entry for interest on capital.

Open in App

Solution

Dr. Profit and Loss Appropriation A/c by $R s . 90, 000$ ;
Cr. Anita's Capital A/c by $R s . 50, 000$ and
Ankita's Capital A/c by $R s . 40, 000$ .

Working Note :
Calculation of Interest on Capital -
Anita $= \frac{10}{100} \times R s .500000 = R s . 50000$
Ankita $= \frac{10}{100} \times R s . 400000 = R s . 40000$

Suggest Corrections

Similar questions

Q. Anita and Ankita are partners sharing profits equally. Their capitals, maintained following Fluctuating Capital Accounts Method, as on 31st March, 2017 were ₹ 5,00,000 and ₹ 4,00,000 respectively. Partnership Deed provided to allow interest on capital @ 10% p.a. The firm earned net profit of ₹ 2,00,000 for the year ended 31st March, 2018.
Pass the journal entry for interest on capital.

Q. Simran and Reema are partners sharing profits in the ratio of

3 : 2

. Their capitals as on 31st March, 2017 were

R s . 2, 00, 000

each whereas Current Accounts had balances of

R s . 50, 000

and

R s . 25, 000

respectively. Interest is to be allowed @ 5% p.a. on balances in Capital Accounts. The firm earned net profit of

R s . 3, 00, 000

for the year ended 31st March, 2018.
Pass the Journal entries for interest on capital and distribution of profit. Also prepare Profit and Loss Appropriation Account for the year.

Q. Kamal and Kapil are partners having fixed capitals of

R s . 5, 00, 000

each as on 31st March, 2017. Kamal introduced further captial of

R s . 1, 00, 000

on 1st October, 2017 whereas Kapil withdrew

R s .1, 00, 000

; on 1st October, 2017 out of capital.
Interest on capital is to be allowed @ 10% p.a.
The firm earned net profit of

R s .6, 00, 000

for the year ended 31st March, 2018.
Pass the Journal entry for interest on capital and prepare Profit and Loss Appropriation Account.

P

and

Q

were partners in a firm sharing profits equally. Their fixed capitals were

R s .1, 00, 000

and

R s .50, 000

respectively. The Partnership Deed provided for Interest on Capital at the rate of

10 %

per annum. For the year ended 31st March, 2016, the profits of the firm were distributed without providing Interest on Capital.
Pass necessary adjustment entry to rectify the error.

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.

Join BYJU'S Learning Program

Dr. Profit and Loss Appropriation A/c by Rs.90,000;Cr. Anita's Capital A/c by Rs.50,000 and Ankita's Capital A/c by Rs.40,000.Working Note :Calculation of Interest on Capital -Anita =10100×Rs.500000=Rs.50000Ankita =10100×Rs.400000=Rs.40000