Question

O ILLUSTRATION 9 Aarti Bharati and Criti were in partnership sharing profits and losses in the ratio 3:4:3 their capitals as on 14 April 2019 were 3,00,000, 5,00,000 and 2,00,000 respectively. According to partnership deed, Criti is entitled to salary of 15,000 p.m., interest on opening capital is to be allowed @ 12% p.a. Aarti was entitled be charged on drawings. Rent paid to Aarti and salary paid to Criti were debited to drawings account of to rent @ 5,000/- p.a. for premises belonging to her, used for the partnership business. No interest to respective partners. Bharti had withdrawn 10,000 per month from the business The profit of the firm for the year ended 314 March 2020, before charging interest in capital amounted to 3 4,60,000 . You are required to prepare Profit and Loss appropriation Account and partners' capital Accounts​

Answer 1

Answer:

this must be the correct answr

Answer 2

The partner's closing capitals are: 3,35,667; 1,24,333;  5,16,667

Given:

Profit before Interest and Salary 4,60,000

To find:

prepare Profit and Loss appropriation Account and partners' capital Accounts​

Solution:

Profit and Loss Appropriation Account for the year ended 31st March 2020:

Particulars Amount (Rs.)

Profit before Interest and Salary 4,60,000

Less: Interest on Capital:

Criti (12% on 5,00,000) 60,000

Aarti (12% on 3,00,000) 36,000

Bharti (12% on 2,00,000) 24,000

Salary to Criti 1,80,000

Rent paid to Aarti 5,000

Less: Charging of Aarti's drawings 30,000

Net Profit transferred to Partner's Capital A/c 3,05,000

Partner's Capital Account:

Aarti

Particulars Amount (Rs.)

Opening Capital 3,00,000

Add: Share of Profit 1,01,667

Less: Drawings (charged to her) 30,000

Less: Interest on Opening Capital 36,000

Closing Capital 3,35,667

Bharti

Particulars Amount (Rs.)

Opening Capital 2,00,000

Add: Share of Profit 68,333

Less: Drawings 1,20,000

Less: Interest on Opening Capital 24,000

Closing Capital 1,24,333

Criti

Particulars Amount (Rs.)

Opening Capital 5,00,000

Add: Share of Profit 1,36,667

Add: Interest on Opening Capital 60,000

Less: Salary 1,80,000

Closing Capital 5,16,667

Therefore, the partner's closing capitals are: 3,35,667; 1,24,333;  5,16,667
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