Question

3. P and Q sharing profits in the ratio of 2 : 1 have fixed capitals of 90,000 and
60,000 respectively. After closing the accounts for the year ending 31st March, 2019 it was discovered that interest on capitals was provided @ 6% instead of 8% p.a. In the adjusting entry​

Answer 1

Answer:

Table showing adjustment

P. Q. Total.

Interest on

capital. 1800. 1200. 3000

(cr)

division of loss

in ratio 2:1. 2000. 1000. 3000

(dr)

Difference. 200. 200

(dr). (cr)

Explanation:

Adjustment entry

P capital account dr 200

To Q capital account. 200