Question

90. The partners of a firm, Alia, Bhanu and Chand distributed the profits for the year ended 31st March, 2017
80,000 in the ratio of 3:3:2 without providing for the following adjustments:
(a) Alia and Chand were entitled to a salary of 1,500 each per month
(b) Bhanu was entitled for a commission of 4,000.
(c) Bhanu and Chand had guaranteed a minimum profit of 35,000 p.a. to Alia any deficiency to borne
equally by Bhanu and Chand.
Pass the necessary Journal entry for the above adjustments in the books of the firm. Show workings clearly
(CBSE Sample Paper 2018)​

Answer 1

Explanation:

(a) salary a/c dr. 36000

to alia. 18000

to chand 18000

(partners credited on account of salary)

(b). commission a/c dr. 4000

to bhanu. 4000

(partner account credited with commission)

(c). bhanu dr. 7500

chand dr. 7500

to alia. 15000

( being deficiency in profit adjustment entered)

explanation (c)

minimum profit guaranteed. 35000

less share of alia's profit 80000 x 2/8. 20000

_______

15000/-