Question

43. Mr. P, Mr. Q and Mr. R are partners in a firm sharing profits in the ratio of 2:2:1. On 1.4.19, the balance
of capital accounts of partners : Mr. P 340,000 ; Mr. Q50,000 and Mr. R330,000.
The net profit of the firm for the year ended on 31.3.20 was 51,000.
You are required to prepare the Profit and Loss Appropriation Account for the year ended on 31.3.20 by
taking into consideration the following information:
o Mr. P is entitled to a salary of 1,000 per month.
(11) Mr. R is entitled to receive commission of 5,000.
(iii) Interest on opening capital is to be allowed @ 5%.​

Answer 1

Answer:

Profit and Loss Appropriation Account is Attached ;

Go Through it..

Working Note :

• Salary -

1,000 × 12 = 12,000

• Interest On Capital -

P = 3,40,000 × ⁵/ 100 = 17,000

Q = 50,000 × ⁵/100 = 2,500

R = 3,30,000 × ⁵/100 = 16,500

• Distribution of Profit -

To P = 2,000 × ⅖ = 800

To Q = 2,000 × ⅖ = 800

To R = 2,000 × ⅕ = 800