Question

32. A and B are partners sharing profit in proportion of 7/10th and 3/10th with capitals of
15,000 and 10,000 respectively as on 1st Jan., 2021. 5% interest was agreed to be
calculated on the capital of each partner and B is to be allowed an annual salary of 2,400
which has not been withdrawn. During the year 2021, A withdrew ? 1,200 and B 2,000 in
anticipation of profits. Profits for the year prior to calculation of interest on capital but after
charging B's salary amounted to 8.000. A provision of 8% of the profits after charging
interest and salary but before charging any commission is to be made in respect of
commission to A
Show :
(i) The Profit and Loss Appropriation Account showing the allocation of profits.
(ii) Partners' Capital Accounts when Capitals are fluctuating,
Ans. Balance of A's Capital Account =* 19,437; B'Stapftal Account =* 12,763.

Answer 1

Answer:

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