provided for the following : (i) Interest on capital @ 5% p.a. (ii) Interest on drawing @ 12% p.a. (iii) Interest on partners' loan @ 6% p.a. - Accountancy

Advertisement Remove all ads

Moli, Bhola and Raj were partners in a firm sharing profits and losses in the ratio of 3 : 3 : 4. Their partnership deed provided for the following :
(i) Interest on capital @ 5% p.a.
(ii) Interest on drawing @ 12% p.a.
(iii) Interest on partners' loan @ 6% p.a.
(iv) Moli was allowed an annual salary of Rs 4,000; Bhola was allowed a commission of 10% of net profit as shown by Profit and Loss Account and Raj was guaranteed a profit of Rs 1,50,000 after making all the adjustments as provided in the partnership agreement.
Their fixed capitals were Moli : Rs 5,00,000; Bhola : Rs 8,00,000 and Raj : Rs 4,00,000. On 1st April, 2016 Bhola extended a loan of Rs 1,00,000 to the firm. The net profit of the firm for the year ended 31st March, 2017 before interest on Bhola's loan was Rs 3,06,000.
Prepare Profit and Loss Appropriation Account of Moli, Bhola and Raj for the year ended 31st March, 2017 and their Current Accounts assuming that Bhola withdrew Rs 5,000 at the end of each month, Moli withdrew Rs 10,000 at the end of each quarter and Raj withdrew Rs 40,000 at the end of each half year.

Advertisement Remove all ads

Solution

                            Realisation Account

Dr.

 

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

To Plant  

2,20,000

By Creditors

75,000

To Investments

70,000

By Bills Payable

40,000

To Stock                                           

50,000

By Outstanding Salary

35,000

To Debtors

60,000

By Bank A/c

 

To Bank

 

Plant                                85,000

 

Creditors                            75,000

 

Stock                               33,000

 

Bills Payable                      40,000

 

Debtors                           47,000

 

Outstanding Salary            35,000

1,50,000

Investments                    66,500

2,31,500

To Bank

 

By Partner’s Capital A/cs-Loss

 

Outstanding Bill for Repair    7,500

 

Srijan                               81,030

 

Dishonoured of                      

Discounted Bill                     15,000

 

22,500

Raman                              81,030

 

To Srijan’s Capital A/c-Commission (2,31,500*.05)

11,575

Manan                             40,515

2,02,575

 

5,84,075

 

5,84,075

 

 

 

 

           

Partners' Capital Account

 
 Particulars Srijan Raman Manan Particulars Srijan Raman Manan
To Balance b/d ---------- ---------- 10,000 By Balance b/d 2,00,000 1,50,000 ---------
To Profit &Loss A/c   32,000 32,000 16,000 By Realisation  A/c-Commission 11,575    
To RealisationA/c-Loss 

81,030

81,030

40,151      
To Bank A/c

98,545

36,970 ---------- By Bank A/c ---------- ---------- 66,515
  2,11,575 1,50,000 66,515   2,11,575 1,50,000 66,515
               

                                  Bank Account

Dr.

 

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Balance b/d

10,000

To Realisation A/c-Recorded liabilities repaid

1,50,000

To Realisation A/c-Assets realised

2,31,500

To Realisation A/c-Unrecorded liabilities repaid

22,500

To Manan’s Capital A/c

66,515

To Srijan’s Capital A/c

98,545

 

 

To Raman’s Capital A/c

36,970

 

 

 

 

 

 

 

 

 

 

 

 

 

3,08,015

 

3,08,015

 

 

 

 

         
Concept: Dissolution of Partnership Firm
  Is there an error in this question or solution?
Advertisement Remove all ads
Advertisement Remove all ads
Share
Notifications

View all notifications


      Forgot password?
View in app×