Question

Fixed Capitals
Q. 8. Y and Z are partners with capitals of $25,000 and 315,000 respectively on
1st April, 2018. Each partner is entitled to 9% p.a. interest on his capital. Z is entitled
to a salary of $6,000 p.a. together with a commission of 6% of Net Profit remaining
after deducting interest on capitals and salary and after charging his commission. The
profits for the year ended 31st March, 2019 before making any of the above mentioned
adjustments amount to 30,800. Prepare Partner's Capital Accounts : (i) When
capitals are fixed, and (ii) when capitals are fluctuating.
[Ans. Divisible Profits 20,000.
(i) When capitals are fixed :
Current A/c balances : Y 12,250 (Cr.); Z 18,550 (Cr.)
Capital A/c balances : Y 25,000 (Cr.); Z 315,000 (Cr.)
(ii) When capitals are fluctuating :
Capital A/c balances : Y 37,250 (Cr.); Z 33,550 (Cr.)]

Answer 1

Explanation:

y and z are partners with capital of rs 25000 and 15000 each partner is entitled to 9% intrest on capital z is entitled to a salary of rs 6000 p.a together with a commision of 6% of net profit remaining after deducting intrest on capitals and salary and after charging his commision the profit for the year before making ..

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