Question

the capitals of a b and c as on 31march 2018 amounted to 90000,330000 and 660000 respectively. the profits amounting 180000 for the year 2017-18 were distributed in the ratio of4:1:1 after allowing interest on capital @10%pa. during the year each partner withdrew 360000. the partnersp deed was silent as to profit sharing ratio but provided for interest on capital @12% . pass necessary adjustment entry.

Answer 1

Debit the account of a by rupees 66,600

Credit the account of b by rupees 30000

Credit the account of c by rupees 36000  

Explanation:

Profit sharing ratio should be equal if it is not mentioned in any partnership deed.

Capital is distributed in the ratio of 4:1:1. Interest on the withdrawn should be charged.

Necessary adjustment entry in the accounts if a,b and c are as follows.  

Debit the account of a by rupees 66,600

Credit the account of b by rupees 30000

Credit the account of c by rupees 36000