**Profit and Loss Appropriation Account for the year ending 31st December 2019**

**Particulars** **Amount (in Rs.)** **Amount (in Rs.)**
**Debit** **Credit**

Profit and Loss Account 23,10,000
X's share of profit (3/6) 11,55,000
Y's share of profit (2/6) 7,70,000
Z's share of profit (1/6) 3,85,000
Interest on Capital:
- X (6% of 2,00,000) 12,000
- Y (6% of 3,10,000) 18,600
- Z (6% of 2,31,000) 13,860
Remaining profit transferred to Balance Sheet 21,27,540
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46,35,000 46,35,000
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**Explanation:**

1. The partnership between X, Y, and Z was formed on 1st July 2019.
2. The profit and losses will be shared in the ratio of 3:2:1.
3. X contributed a capital of Rs. 2,00,000, Y contributed Rs. 3,10,000, and Z contributed Rs. 2,31,000.
4. X guaranteed that Z's share of profit, after charging interest on capitals at 6% per annum, would not be less than Rs. 36,000.
5. The total profit for the year is Rs. 23,10,000.
6. The profit and loss appropriation account is prepared to distribute the profit among the partners and calculate the interest on capital.

**Calculation of Shares:**

- X's share of profit = (3/6) * Rs. 23,10,000 = Rs. 11,55,000
- Y's share of profit = (2/6) * Rs. 23,10,000 = Rs. 7,70,000
- Z's share of profit = (1/6) * Rs. 23,10,000 = Rs. 3,85,000

**Calculation of Interest on Capital:**

- X's interest on capital = 6% of Rs. 2,00,000 = Rs. 12,000
- Y's interest on capital = 6% of Rs. 3,10,000 = Rs. 18,600
- Z's interest on capital = 6% of Rs. 2,31,000 = Rs. 13,860

**Profit and Loss Appropriation Account:**

- The profit and loss account is debited with the total profit of Rs. 23,10,000.
- X's share of profit is credited with Rs. 11,55,000.
- Y's share of profit is credited with Rs. 7,70,000.
- Z's share of profit is credited with Rs. 3,85,000.
- The interest on capital is debited and credited to respective partners' accounts.
- The remaining profit after deducting interest on capital is transferred to the balance sheet.

The above Profit and Loss Appropriation Account shows the distribution of profit among the partners and