Q. 11 (B). A and B are partners in a firm. Their capitals as on 1st April, 2016 were
2,10,000 and 90,000 respectively. They share profits in the ratio of 2 : 1. On 1st
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August, 2016, they decided that their capitals should be readjusted according to their
profit sharing ratio. The necessary adjustments in the capitals were made by
withdrawing or introducing cash. Interest on capital is allowed at 12% p.a. Compute
interest on capitals for the year ending on 31st March, 2017.
[Ans. Interest on Capitals : A *24,400; B 11,600.]
72 an
Answers
Answer:
Explanation:
Calculation of interest on Capital A
On 1st April : Amount introduced 210000
No. of months 31 March 12%
Interest : 25200
On 1st April : Amount Withdrawn 10000
No. of months 31 March 8%
Interest : 800
Total = 200000
T. Interest : 24400
Calculation of interest on Capital B
On 1st April : Amount introduced 90000
No. of months 31 March 12%
Interest : 10800
On 1st April : Amount Withdrawn 10000
No. of months 31 March 8%
Interest : 800
Total = 100000
T. Interest : 11600
Capital Adjustment for both:
Capital A before adjustment : 210000
capital B before adjustment : 90000
total capital 300000
Capital of A ( 300000 *2/3) 200000
Capital A withdraw (210000 - 200000) 10000
Capital B( 300000 *1/3) 100000
Cash B withdraw ( 100000 - 90000) 10000