x and y are partners sharing profits and losses in the ratio of 3:2 with capitals of rs.24,000 and RS. 12,000. on 1 July 2019,x and y granted loans of RS. 48,000 and RS. 18,000 respectively to the form. shoe the distribution profits/losses for the year 2019, if the profits before any interest for the year amounted to RS.1,800
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)