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.
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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 Interest on the withdrawn should be charged.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
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