From the following Balance Sheet of Long and Short- calculate interest on capital - 8 - p-a- for the year ended 31st March- 2019 -BALANCE SHEETDuring the year- Long withdrew - 40-000 and Short withdrew - 50-000 - Profit for the year was - 1-50-000 out of which 1-00-000 was transferred to General Reserve-

You visited us 12 times! Enjoying our articles? Unlock Full Access!

Byju's Answer

Standard VI

Mathematics

Finding Amount

From the foll...

Question

From the following Balance Sheet of Long and Short, calculate interest on capital @ 8% p.a. for the year ended 31st March, 2019.

BALANCE SHEET
as at 31st March, 2019

Liabilities ₹ Assets ₹

Long's Capital A/c 1,20,000 Fixed Assets 3,00,000

Short's Capital A/c 1,40,000 Other Assets 60,000

General Reserve 1,00,000

3,60,000 3,60,000

During the year, Long withdrew ₹ 40,000 and Short withdrew ₹ 50,000. Profit for the year was ₹ 1,50,000 out of which ₹ 1,00,000 was transferred to General Reserve.

Open in App

Solution

Calculation of Capital at the beginning (as on April 01, 2018)

Particulars

Long
(₹)

Short
(₹)

Capital at the end

1,60,000

1,40,000

Less: Adjusted Profit (1,50,000 – 1,00,000) in 1:1 ratio

(25,000)

(25,000)

Add: Adjusted Drawings

-

50,000

Capital in the beginning

1,35,000

1,65,000

Suggest Corrections

127

Similar questions

Q. From the following Balance Sheet of Long and Short, calculate interst on capital @ 8% p.a. for the year ended 31st March, 2018.

BALANCE SHEET as at 31st March, 2018
Liabilities	₹	Assets	₹
Long's Capital A/c	1,20,000	Fixed Assets	3,00,000
Short's Capital A/c	1,40,000	Other Assets	60,000
General Reserve	1,00,000
	3,60,000		3,60,000

During the year, Long withdrew ₹ 40,000 and Short withdrew ₹ 50,000. Profit for the year was ₹ 1,50,000 out of which ₹ 1,00,000 was transferred to General Reserve.

Q. Following is the extract of the Balance Sheet of Neelkant and Mahadev as on 31st March, 2019.

BALANCE SHEET
as at 31st March, 2019
Liabilities	₹	Assets	₹
Neelkant's Capital	10,00,000	Sundry Assets	30,00,000
Mahadev's Capital	10,00,000
Neelkant's Current A/c	1,00,000
Mahadev' Current A/c	1,00,000
Profit and Loss Appropriation A/c (2018-19)	8,00,000
	30,00,000		30,00,000

During the year, Mahadev's drawings were ₹ 30,000. Profits during the year ended 31st March, 2019 is ₹ 10,00,000. Calculate interest on capital @ 5% p.a. for the year ending 31st March, 2019.

Q. Ashish and Aakash are partners sharing profit in the ratio of 3 : 2. Their Capital Accounts showed a credit balance of ₹ 5,00,000 and ₹ 6,00,000 respectively as on 31st March, 2019 after debit of drawings during the year of ₹ 1,50,000 and ₹ 1,00,000 respectively. Net profit for the year ended 31st March, 2019 was ₹ 5,00,000. Interest on capital is to be allowed @ 10% p.a.
Pass the Journal entry for interest on capital and prepare Profit and Loss Appropriation Account.

Q. Ram and Mohan are partners in a business. Their capitals at the end of the year were ₹ 24,000 and ₹ 18,000 respectively. During the year, Ram's drawings and Mohan's drawings were ₹ 4,000 and ₹ 6,000 respectively. Profit (before charging interest on capital) during the year was ₹ 16,000. Calculate interest on capital @ 5% p.a. for the year ended 31st March, 2019.

Q. Bhanu and Partab are partners sharings profits equally. Their fixed capitals as on 1st April, 2018 are ₹ 8,00,000 and ₹ 10,00,000 respectively. Their drawings during the year were ₹ 50,000 and ₹ 1,00,000 respectively. Interest on Capital is a charge and is to be allowed @ 10% p.a. and interest on drawings is to be charged @ 15% p.a. Net Profit for the year ended 31st March, 2019 was ₹ 1,20,000.
Prepare Profit and Loss Appropriation Account.

Join BYJU'S Learning Program

BALANCE SHEET as at 31st March, 2019
Liabilities	₹	Assets	₹
Long's Capital A/c	1,20,000	Fixed Assets	3,00,000
Short's Capital A/c	1,40,000	Other Assets	60,000
General Reserve	1,00,000
	3,60,000		3,60,000

Particulars	Long (₹)	Short (₹)
Capital at the end	1,60,000	1,40,000
Less: Adjusted Profit (1,50,000 – 1,00,000) in 1:1 ratio	(25,000)	(25,000)
Add: Adjusted Drawings	-	50,000
Capital in the beginning	1,35,000	1,65,000

Calculation of Capital at the beginning (as on April 01, 2018) Particulars Long (₹) Short (₹) Capital at the end 1,60,000 1,40,000 Less: Adjusted Profit (1,50,000 – 1,00,000) in 1:1 ratio (25,000) (25,000) Add: Adjusted Drawings - 50,000 Capital in the beginning 1,35,000 1,65,000