1. A &B are partners with capital of 300000 and 200000 on 1-04-2019. On 1st Aug they introduced further capital of 50000 and 40000 each. B withdrew 20000 from his capital on 1st March 2020. Calculate IOC at 6% for the year ending 31/03/2020.
Answers
Answer:
PROFIT AND LOSS APPROPRIATION ACCOUNT
Particulars Amount Particulars AmountTo Int on capital
A=50000*6%
= 3000
B=30,000*6%
= 1800 4800 By net profit 50000To Commission
A=300000*2% 6000 To Salary
B=500*12 6000 To Commission
B(notes) 1581 To profits t/f to
A's Capital A/c= 23714
B's Capital A/c=7905 31619 Total 50000 Total 50000 PARTNERS CAPITAL ACCOUNT Particulars A B ParticularsA B To drawings 8000 6000 By bal b/d 50000 30000 By Int on
capital3000 1800 By commission 6000 1581 To bal c/d 74714 35286 By P/L app A/c 23714 7905 Total 82714 41286 Total 82714 41286 Notes:- Commission to B= 5% of profits after all expenses including such commission
= 50,000-4800-6000-6000
= 33,200*5/105 = 1581.
hence,year ending 31/3/2020=22,200*/105=1581