A B and C started a business on 1st April 2017 with capital of 450000, 600000 and 350000 respectively according to partnership argument:
i. Profit earned in in any year will be distributed as under: upto 270000-equally. Excess over 270000 - one half 2 A, one sixth to B, one third to C.
ii. Provide interest on capital and drawing 6% per annum.
iii.C is entitled how to get a monthly e salary of 4000 and and B is entitled to get a monthly salary of 6000. In addition to above c and B are entitled to get a commission of 5% each on net profit after taking into consideration salary, interest and all Commissions.
Drawings of the partners during the year were:
- A withdrew regularly 5000 at the beginning of every month.
-B withdrew regularly 7000 at the end of every month.
-C withdrew 80000 during the year.
The profit of the firm for the year ended 31st March 2018 before charging all of the above adjustment was 593120.
Answers
Answer:
The question is incomplete but i believe it requires the appropriation account.
ABC appropriation account in the year ended March 31, 2018
Amount
Net profit 593120
Add interest on drawings
A 6% of (5000x12) 3600
B 6% of (7000x12) 5040
C 6% of 80000 4800 13440
606560
Less salaries
B (4000X12) 48000
C (6000X12) 72000
Interest on Capital
A 6% of 450000 27000
B 6% of 600000 36000
C 6% of 350000 21000 204000
402560
less commisions
B 5% of 402560 20128
C 5% of 402560 20128 40256
362304
share of profits
A (270000/3) 90000
B (270000/3) 90000
C (270000/3) 90000
EXCEESS AMOUNT (362304-92304)
Share of excess amount
A(1/2 X 92304) 46152
B(1/6 X 92304) 15384
C(1/3 X 92304) 30768 362304
That is the format of an appropriation account.
If the current account is required the amounts added here will be debited including the drawings while the amounts subtracted here will be credited.
Answer:
Explanation:
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