Question

A, B and C are partners in a firm. Their profit sharing ratio is 3 : 2: 1.
However, is guaranteed a minimum amount of 10,000 as share of profits every
years. Any dificeincy arising on that account shall be met by A . The profits for the two years ending 31st March, 2015 and 2016 were 30,000 and
90,000 respectively.
Prepare Profit and Loss Appropriation Account for the two years.​

Answer 1

Answer:

ANSWER

PROFIT AND LOSS APPROPRIATION ACCOUNT FOR THE YEAR 2017

Particulars Amount Particulars Amount

To Profit transferred to-

A's capital A/c- 16000

B's capital A/c-16,000

Less:deficiency-(2000)

C's capital A/c-8000

Add:share 2000 40,000 By net profit 40,000

Total 40,000 Total 40,000

PROFIT AND LOSS APPROPRIATION ACCOUNT FOR THE YEAR 2018

Particulars Amount Particulars Amount

To profit transferred to-

A's capital A/c-24,000

B's capital A/c-24,000

C's capital A/c-12,000 60,000 By net profit 60,000

Total 60,000 Total 60,000