Question

A B and C were partners in a firm sharing profits in the ratio of 3:2:1. During the 2018-19, after
preparing partners capita a/c it was noticed the net profit during the year, amounted to Rs 96000 were
wrongly distributed in the ratio of 1:1:1. You are requested to pass necessary adjustment entries in the
books of the company

Answer 1

Profit And Loss Account

Particulars  Amount Particulars   Amount

To Manager;s

commission

(15000*5/100)  750  By profit before B's Salary

(12500+2500)  15000

To Net profit T/f to

P/L Appropriation

Account  14250    

Total  15000  Total  15000

                            Profit And Loss Appropriation Account

Particulars  Amount  Particulars Amount

To Interest on capital

A = 50000*6% = 3000

B=30000*6% = 1800  4800  By net profit  14250

B's Salary  2500    

To profit T/f to

A's Capital A/c = 4170

B's Capital A/c = 2780  6950    

Total  14250  Total  14250

     

                                     Partners  capital account

Particulars  A  B  Particulars  A  B

      By bal b/d 50000   30000

      By Int on capital  3000  1800

      salary    2500

To bal c/d  57170  37080  By P/L Appr A/c  4170  2780

Total  57170  37080  Total  57170  37080