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Question
The capital accounts of Moli and Golu showed balances of Rs 40,000 and Rs 20,000 as on April 01, 2016. They shared profits in the ratio of 3:2. They allowed interest on capital @ 10% p.a. and interest on drawings, @ 12 p.a. Golu advanced a loan of Rs 10,000 to the firm on August 01, 2016. During the year, Moli withdrew Rs 1,000 per month at the beginning of every month whereas Golu withdrew Rs 1,000 per month at the end of every month. Profit for the year, before the above mentioned adjustments was Rs 20,950. Calculate interest on drawings show distribution of profits and prepare partner’s capital accounts.
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Solution
Interest on Moli’s Drawing = Total Drawings × `"Rate"/100` x `13/[2 xx 12]`
= 12,000 x `12/100 xx 13/[2 xx 12]`
= Rs 780
Interest on Golu’s Drawings = Total Drawing × `"Rate"/100` x `11/[2 xx 12]`
= 12,000 x `12/100 xx 11/[2 xx 12]`
= Rs 660
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Profit and Loss Adjustment Account |
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Dr. |
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Cr. |
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Particulars |
Amount Rs |
Particulars |
Amount Rs |
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Interest on Capital : |
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Profit and Loss Account |
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20,950 |
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Moli |
4,000 |
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Interest on Drawings : |
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|||
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Golu |
2,000 |
6,000 |
Moli |
780 |
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Golu |
660 |
1,440 |
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Interest on Partner’s Loan |
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Golu’s {10,000 × (6/100) × (8/12)} |
400 |
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Profit transferred to : |
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Moli’s Capital {15,990 ×(3/5)} |
9,594 |
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Golu’s Capital {15,990 ×(2/5)} |
6,396 |
15,990 |
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22,390 |
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22,390 |
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Partners’ Capital Account |
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Dr. |
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|
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Cr. |
|
Particulars |
Moli |
Golu |
Particulars |
Moli |
Golu |
|
Drawings |
12,000 |
12,000 |
Balance b/d |
40,000 |
20,000 |
|
Interest on Drawing |
780 |
660 |
Interest on Capital |
4,000 |
2,000 |
|
Balance c/d |
40,814 |
15,736 |
Profit and Loss Adjustment |
9,544 |
6,396 |
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|
53,594 |
28,396 |
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53,594 |
28,396 |
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|
Rudra, Dev and Shiv were partners in a firm sharing profits in the ratio of 5 : 3 : 2. Their fixed capitals were ₹ 6,00,000, ₹ 4,00,000, and ₹ 2,00,000, respectively. Besides his capital, Shiv had given a loan of ₹ 75,000 to the firm. Their partnership deed provided for the following:
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| Particulars | (₹) | Particulars | (₹) |
| To Interest on Capital | By Profit & loss account (After manager’s commission) | ___(2)___ | |
| Richa | ______ | ||
| Anmol | ______ | ||
| To Anmol’s Salary a/c | 12,500 | ||
| To Profit transferred to: | |||
| Richa’s Capital A/C (1) | ___(1)___ | ||
| Anmol’s Capital A/c | ______ | ||
| ______ | ______ |
The amount to be reflected in blank (1) will be:
Richa and Anmol are partners sharing profits in the ratio of 3 : 2 with capitals of ₹ 2,50,000 and ₹ 1,50,000 respectively. Interest on capital is agreed @6% p.a. Anmol is to be allowed an annual salary of ₹ 12,500. During the year ended 31st March 2023, the profits of the year prior to calculation of interest on capital but after charging Anmol’s salary amounted to ₹ 62,000. A provision of 5% of this profit is to be made in respect of manager’s commission.
Following is their Profit & Loss Appropriation Account.
| Particulars | (₹) | Particulars | (₹) |
| To Interest on Capital | By Profit & loss account (After manager’s commission) | ___(2)___ | |
| Richa | ______ | ||
| Anmol | ______ | ||
| To Anmol’s Salary a/c | 12,500 | ||
| To Profit transferred to: | |||
| Richa’s Capital A/C (1) | ___(1)___ | ||
| Anmol’s Capital A/c | ______ | ||
| ______ | ______ |
The amount to be reflected in blank (2) will be:
