Question

A and B are partners in a business and their capitals at the end of the year were Rs

7,00,000 and Rs 6,00,000 respectively. Calculate their opening capitals on the basis of

the following information;

 Drawings of A and B for the year were Rs 75,000 and Rs 50,000

 B introduced capital of Rs 1,00,000 during the year.

 Interest on capital credited to the Capital Accounts of A and B were Rs 15,000

and Rs 10,000 respectively.

 Interest on drawings debited to capital Accounts of A and B were Rs 7,500 Rs

10,000 respectively.

 Share of profit credited to Capital Accounts was Rs 1,00,000 each.
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Answer 1

Answer:

Calculation of Opening Capital

A B

Closing capital 7,00,000 6,00,000

Add:Drawings 75,000 50,000

Interest on drawings 7500 5000

Less:-Additional capital nil (1,00,000)

Interest on capital ( 15,000) (10,000)

Share of profits (1,00,000) (1,00,000)

Opening capital 6,67,500 4,45,000

Answered By

Answer 2

Answer:

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