Question

the total capital of the firm is to be the same as before retirement. individual capital be in their profit sharing ratio 3:2 , capital is 300000:200000​

Answer 1

Answer:

PROFIT AND LOSS APPROPRIATION ACCOUNT

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital X= 50,000

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital X= 50,000To Salary

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital X= 50,000To SalaryY= 30,000 80,000 By net profit 80,000

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital X= 50,000To SalaryY= 30,000 80,000 By net profit 80,000 Total 80,000 Total 80,000

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital X= 50,000To SalaryY= 30,000 80,000 By net profit 80,000 Total 80,000 Total 80,000Interest on X's capital = 20,00,000*8%=1,60,000

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital X= 50,000To SalaryY= 30,000 80,000 By net profit 80,000 Total 80,000 Total 80,000Interest on X's capital = 20,00,000*8%=1,60,000Salary to Y = 8000*12 = 96,000

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital X= 50,000To SalaryY= 30,000 80,000 By net profit 80,000 Total 80,000 Total 80,000Interest on X's capital = 20,00,000*8%=1,60,000Salary to Y = 8000*12 = 96,000Total = 2,56,000

PROFIT AND LOSS APPROPRIATION ACCOUNT Particulars Amount Particulars Amount To Interest on capital X= 50,000To SalaryY= 30,000 80,000 By net profit 80,000 Total 80,000 Total 80,000Interest on X's capital = 20,00,000*8%=1,60,000Salary to Y = 8000*12 = 96,000Total = 2,56,000Net profits available is less than the appropriations to be made. So,the appropriations are to be made in the ratio of interest and salary i.e 5:3.