Question

Calculation of Commission and Distribution of Profits
bi
X, Y and Z are partners in a firm with respective capitals of 50.000, 30,000 and
20,000. According to the aprtnership deed each partner is entitled to interest on
capital @ 5% p.a. and a salary of 1,000 p.a. of the net divisible profit X is entitled
to 40% : Y to 30% and 2 to 30% of the first 5.000. Over this amount, the the profit
is to be shared equally. The Profit and Loss a/c for the year ended 2017, disclosed
a net profit of 25,000.
Prepare Profit and Loss Appropriation Account and Partners capital Accounts for
2017.

Answer 1

Answer:

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