Ram and Rahim are partners in a a firm sharing profits and losses equally. On 1st April 2012, their capitals were ₹80,000 and ₹60,000 respectively. Interest is to be allowed on capital at 10% per annum. Ram brought an additional capital of ₹30,000 on 1st October 2012, their drawings during the year amounted to ₹12,000 and ₹8,000 respectively and the interest on drawings are charged at 10% pa on an average basis, Ram is entitled to a monthly salary of₹1,000 and Raheem is entitled to ₹6,000 pa. The net profit for the year ended 31st March 2013 before making the above adjustments amounted to ₹47,500. Prepare a profit and loss appropriation on 31st March 2013.
Answers
Answer:
Calculation of Capital balance in the beginning:
Particulars Ram Mohan
Capitals at the end of the year 24000 18000
Less: Profit already credited (8000) (8000)
Add: Drawings already debited 4000 6000
Capital at the beginning of the year 20000 16000
Note: Interest on capital is always calculated on the opening balance of the partner's capital.
Ram's interest on capital= 20000 * 5/100
= 1000
Mohan's interest on capital= 16000 * 5/100
= 800
Explanation:
Hope it helps you mate ✌
Answer:
Ram and Rahim are partners in a a firm sharing profits and losses equally. On 1st April 2012, their capitals were ₹80,000 and ₹60,000 respectively. Interest is to be allowed on capital at 10% per annum. Ram brought an additional capital of ₹30,000 on 1st October 2012, their drawings during the year amounted to ₹12,000 and ₹8,000 respectively and the interest on drawings are charged at 10% pa on an average basis, Ram is entitled to a monthly salary of₹1,000 and Raheem is entitled to ₹6,000 pa. The net profit for the year ended 31st March 2013 before making the above adjustments amounted to ₹47,500. Prepare a profit and loss appropriation on 31st March 2013.