Question

A,B and C are partners in a firm. Share profit 5:3:2. There capital are 3 lakh,2lakh and 1 lakh respectively. Interest on capital is allowed @10% on their capital and firm has a net profit before Interest on capital 80,000. Calculate interest on capital and distribution of profit.​

Answer 1

Answer

Partner A : 40K profit (50% of net 80K profit) + 4%of 40K interest = 4K , So total 44K earned on Capital investment of 3Lac = Total Asset of Partner A = 3.44Lac

Partner B = Total Asset of Partner B = 224240 L

Partner C = Total Asset of partner c = 116160 L

Explanation: