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A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ?
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A and B share profits and losses in the ratio of 2:1 . They admit C as...
Calculation of Profits and Losses:
- Total loss of the firm: Rs. 3,20,000
- A's share of loss (2/3 * Rs. 3,20,000): Rs. 2,13,333.33
- B's share of loss (1/3 * Rs. 3,20,000): Rs. 1,06,666.67
Entry for Distribution of Profits and Guarantee:
- To adjust A's capital account: Debit A's capital account by Rs. 2,13,333.33
- To adjust B's capital account: Debit B's capital account by Rs. 1,06,666.67
- To adjust C's capital account: Debit C's capital account by Rs. 1,00,000
- To adjust Profit and Loss account: Credit Profit and Loss account by Rs. 3,20,000
Explanation:
- A and B's total loss sharing ratio is 2:1, which is 2/3 and 1/3 respectively.
- C's share of profits is 1/4, which is guaranteed to be at least Rs. 1,00,000.
- Since the firm incurred a net loss of Rs. 3,20,000, A's share of loss is Rs. 2,13,333.33 and B's share is Rs. 1,06,666.67.
- The entry is made to adjust the capital accounts of A, B, and C based on their profit-sharing ratios and the guarantee given to C.
- A and B's capital accounts are debited to reflect their share of the loss, while C's capital account is debited by Rs. 1,00,000 as per the guarantee.
- The Profit and Loss account is credited with the total loss amount of Rs. 3,20,000 to balance the entry and reflect the loss incurred by the firm.
- Total loss of the firm: Rs. 3,20,000
- A's share of loss (2/3 * Rs. 3,20,000): Rs. 2,13,333.33
- B's share of loss (1/3 * Rs. 3,20,000): Rs. 1,06,666.67
Entry for Distribution of Profits and Guarantee:
- To adjust A's capital account: Debit A's capital account by Rs. 2,13,333.33
- To adjust B's capital account: Debit B's capital account by Rs. 1,06,666.67
- To adjust C's capital account: Debit C's capital account by Rs. 1,00,000
- To adjust Profit and Loss account: Credit Profit and Loss account by Rs. 3,20,000
Explanation:
- A and B's total loss sharing ratio is 2:1, which is 2/3 and 1/3 respectively.
- C's share of profits is 1/4, which is guaranteed to be at least Rs. 1,00,000.
- Since the firm incurred a net loss of Rs. 3,20,000, A's share of loss is Rs. 2,13,333.33 and B's share is Rs. 1,06,666.67.
- The entry is made to adjust the capital accounts of A, B, and C based on their profit-sharing ratios and the guarantee given to C.
- A and B's capital accounts are debited to reflect their share of the loss, while C's capital account is debited by Rs. 1,00,000 as per the guarantee.
- The Profit and Loss account is credited with the total loss amount of Rs. 3,20,000 to balance the entry and reflect the loss incurred by the firm.
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A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ?
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A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ?.
A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ?.
Solutions for A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ? in English & in Hindi are available as part of our courses for Commerce.
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A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ?, a detailed solution for A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ? has been provided alongside types of A and B share profits and losses in the ratio of 2:1 . They admit C as partner with 1/4 share in profits with a guarantee that his share of profit shall be at Least RS.1,00,000. The net loss of the firm for the year ending March 31,2006 was Rs. 3,20,000 . Pass an entry for distribution of profits and guarantee ? theory, EduRev gives you an
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