X & Y are partners sharing profit and losses in the ratio of 2 : 3 with capitals of ₹12,000 and ₹6,000 respectively on 1st October 2018. X & Y granted loans of ₹24000 and ₹12000 respectively to the firm. The losses before any interest for the year 2018 19 amounted to ₹900. Show the distribution of profits/losses.
Answers
Explanation:
Assuming that there is existence of partnership deed among the partners.
Interest on capital and loan @ 6%p.a is to be paid. But as there is no enough profits,interest on capital cannot be provided for.
Case 1.
Net profit = 21,000
less:Interest on loan
X= 80,000*6%*1/2 = 2400
Y = 40,000*6%*1/2=1200 3,600
Share of profits 17,400
X = 6,960
Y= 10,440
Case 2.
Net profit = 3,000
Less:- interest on loan =( 3,600)
Loss =(600)
Interest on loan is to be provided even if there is loss.
Case 3.
Net profit = 5000
Less: Interest on loan = 3,600
Remaining profit = 1,400
Share of profit
X = 560
Y = 840
Case 4.
Net Loss = 1,400
Less:Interest on Loan = (3,600)
Loss = (5,000)
Explanation:
loss # 5000
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