On 1st April 2013 Jay and Vijay entered into partnership for supplying...
Profit and Loss Appropriation Account for the year ended 31st March 2014
- **Calculation of Interest on Capital**
- Jay's capital = Rs 80,000
- Vijay's capital = Rs 50,000
- Total capital = Rs 1,30,000
- Interest on capital @ 9% = Rs 11,700 (1,30,000 * 9%)
- **Calculation of Profit**
- Total profit = Rs 7,800
- Interest on capital = Rs 11,700
- Adjusted profit = Rs (11,700 - 7,800) = Rs 3,900
- **Distribution of Profit**
- Jay's share (3/5 of profit) = Rs (3/5 * 3,900) = Rs 2,340
- Vijay's share (2/5 of profit) = Rs (2/5 * 3,900) = Rs 1,560
Profit and Loss Appropriation Account
| Particulars | Amount (Rs) |
|----------------------|-------------|
| Total Profit | 7,800 |
| Less: Interest on Capital | 11,700 |
| Adjusted Profit | 3,900 |
| Jay's share | 2,340 |
| Vijay's share | 1,560 |
| | |
| Total | 3,900 |
This account shows the distribution of profit between Jay and Vijay after considering the interest on capital. Jay receives Rs 2,340 and Vijay receives Rs 1,560 as their shares of the profit. The interest on capital is calculated at 9% per annum as per the partnership deed.
On 1st April 2013 Jay and Vijay entered into partnership for supplying...
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