Question

Profits earned by a partnership firm for the year ended 31st March, 2017 were distributed equally between the partners Pankaj and Anu without allowing interest on capital. Interest due on capital was Pankaj ₹ 3,000 and Anu ₹ 1,000.

Answer 1

The adjustment amount are calculated below:

Explanation:

Given,

Profits  were distributed equally between the partners Pankaj and Anu without allowing interest on capital.

Interest due on capital was Pankaj ₹ 3,000 and Anu ₹ 1,000.

Total interest will be (Rs. 3000 + Rs. 1000) i.e., Rs. 4000

Profit which is wrongly distributed between them will be Rs. 2000 each

Adjustment amount will be calculated as below:

Pankaj = Rs. 3000 - Rs. 2000 = Rs. 1000 (this need to be added to his account)

Anu = Rs. 1000 - Rs. 2000 = - Rs. 1000 ( this need to be deducted from his account)

Thus, an amount of Rs. 1000 has to be credited to Pankaj's Capital account from Anu's account.

Answer 2

Answer:

guys interest on drawing not charged is not an income of the firm it is a loss which is to be incurred