Question

Show the Distribution of Profit among
79. Asis, Ranjan and Subrata who were property consultants and sharing profits in the ratio of 2:1: 2. As per
the terms of the deed the commission earned by Subrata for the firm shall not be less than 30,000 in
any year and Ranjan's share in profit be not less than 40,000. It was further agreed that excess payable
to Ranjan over his share will be borne by Asis only.
The profit for the year ended 31st March, 2020 after considering commission earned by Subrata was
1,80,000. Subrata earned * 24,000.
Prepare Profit and Loss Appropriation Account.​

Answer 1

In the absence of Partnership Deed, the provisions of Indian Partnership Act, 1932 are applicable. Accordingly,

a. No Salary is to be allowed to a partner

b. No Interest on Partner's Capital is to be allowed

c. Interest on Partner's Loan to be allowed at 6% p.a.

d. Distribution of Profit to be done in equal ratio

e. No Interest on Partner's Drawings to be charged