Amit, Binita and Charu are three partners. On 1st April, 2017, their Capitals stood as: Amit ₹ 1,00,000, Binita ₹ 2,00,000 and Charu ₹ 3,00,000. It was decided that:
(a) they would receive interest on Capital @ 5% p.a.
(b) Amit would get a salary of ₹ 10,000 per month.
(c) Binita would receive commission @ 5% of net profit after deduction of commission, and
(d) 10% of the net profit would be transferred to the General Reserve.
Before the above items were taken into account, the profit for the year ended 31st March, 2018 was ₹ 5,00,000. Prepare Profit and Loss Appropriation Account and the Capital Accounts of the partners.
Answers
Answer:
Explanation:
PROFIT & LOSS APPROPIATE A/C
To Interest on Capital By Profit & loss A/c 5,00,000
Amit 5000
Binita 10000
Charu 15000 30000
To Salary to amit 120000
To commission 23810
To General Reserve 50000
To profit transfered
Amit A/c 92063
Binita A/c 92063
Charu A/c 92064 276190
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5,00,000 5,00,000
PATNERS CAPITAL ACCOUNT
Particulars Amit Binita charu Particulars Amit Binita Charu
To Bal C/d 317063 325873 407064 By bal b/d 100000 200000 300000
By Interest on Capital 5000 10000 15000
By salary A/c 1,20,000
By Commision 23810
By p&l A/c 92063 92063 92064
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317063 325873 407064 317063 325873 407064
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