Question

X and y are partners with capitals of 100000 and 80000 respectively on 1st April 2016 and their profitsharing ratio is 2:1. Interest on capital is agreed @12%p.a. y is to be allowed an annual salary of 6000 . The profit of the year ended 31st March 2017amounted to 50000 . Manager is entitled to a commission of 10% of the profits . Prepare profit and loss appropriation account and capital account.

Answer 1

Answer:

PROFIT & LOSS APPROPRIATION A/C

particular. ₹. particular. ₹

To interest By p&l A/C. 50000

on capital

X= 12000

Y= 9600. 21,600

To Manager

commission 5000

To Capital a/c23,400

x=15,600

y=7,800

Total. 50000. Total. 50000

PARTNER'S CAPITAL A/C

Particular. x. y. particular. x. y

by balance

b/d 10,00,000 80000

by intrest on. 12000 9600

capital

by p&l app. 15,600 7800

Total. 10,27,600 97,400 total. 10,27,600 97,400