Question

a b and c entered into partnership on 1 july 2017 to share prots and losses in ratio 5:3:2 A personally guaranteed that c share at prifit ater charging interest on capit @ 8% p.a.would not be less than that 160000 p.a the capital contributed were A: 400000B:3000090 C : 200000 profit for the year ended on 31 March 201 was Rs 474000 prepare profit and loss appropriation account
​

Answer 1

Answer:

PROFIT AND LOSS APPROPRIATION ACCOUNT

Particulars Amount Particulars Amount

To Int on capital

A=50000*6%

= 3000

B=30,000*6%

= 1800 4800 By net profit 50000

To Commission

A=300000*2% 6000

To Salary

B=500*12 6000

To Commission

B(notes) 1581

To profits t/f to

A's Capital A/c= 23714

B's Capital A/c=7905 31619

Total 50000 Total 50000

PARTNERS CAPITAL ACCOUNT

Particulars A B Particulars A B

To drawings 8000 6000 By bal b/d 50000 30000

By Int on

capital 3000 1800

By commission 6000 1581

To bal c/d 74714 35286 By P/L app A/c 23714 7905

Total 82714 41286 Total 82714 41286

Notes:- Commission to B= 5% of profits after all expenses including such commission

= 50,000-4800-6000-6000

= 33,200*5/105 = 1581.