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A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying on business in partnership the firm's reported profit for the year was rs 80000 as per provision of the indian partnership act 1932 find out the share of each partner in the above amount after taking into account that no interest has been provided on advance by a of rs 20,000 in addition to his capital contribution?
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A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying ...
Solution:
Calculation of profit sharing ratio:
- A's capital = Rs 50,000 + Rs 20,000 (advance) = Rs 70,000
- B's capital = Rs 40,000
- C's capital = Rs 30,000
- Total capital = Rs 1,40,000
A's share in the profit:
- A's share = (A's capital / Total capital) * Total profit
- A's share = (70,000 / 1,40,000) * 80,000
- A's share = Rs 40,000
B's share in the profit:
- B's share = (B's capital / Total capital) * Total profit
- B's share = (40,000 / 1,40,000) * 80,000
- B's share = Rs 22,857.14
C's share in the profit:
- C's share = (C's capital / Total capital) * Total profit
- C's share = (30,000 / 1,40,000) * 80,000
- C's share = Rs 17,142.86
Explanation:
- The partnership deed should specify the profit sharing ratio among the partners. In the absence of such a clause, the profit sharing ratio is assumed to be equal among the partners.
- In this case, the capital contribution of each partner is different and hence, the profit sharing ratio needs to be calculated based on their capital contributions.
- A has contributed an additional amount of Rs 20,000 as an advance, which is not treated as a loan and hence, no interest is provided on it. This amount is treated as a part of A's capital contribution for the purpose of calculating the profit sharing ratio.
- The profit sharing ratio is calculated based on the capital contribution of each partner. This ratio determines the share of each partner in the profits of the firm.
- In this case, A has the highest capital contribution and hence, he gets the highest share in the profits. B and C get their shares based on their capital contributions.
- This method of sharing profits ensures that the partners are rewarded for their capital contribution and the risks associated with it.
Calculation of profit sharing ratio:
- A's capital = Rs 50,000 + Rs 20,000 (advance) = Rs 70,000
- B's capital = Rs 40,000
- C's capital = Rs 30,000
- Total capital = Rs 1,40,000
A's share in the profit:
- A's share = (A's capital / Total capital) * Total profit
- A's share = (70,000 / 1,40,000) * 80,000
- A's share = Rs 40,000
B's share in the profit:
- B's share = (B's capital / Total capital) * Total profit
- B's share = (40,000 / 1,40,000) * 80,000
- B's share = Rs 22,857.14
C's share in the profit:
- C's share = (C's capital / Total capital) * Total profit
- C's share = (30,000 / 1,40,000) * 80,000
- C's share = Rs 17,142.86
Explanation:
- The partnership deed should specify the profit sharing ratio among the partners. In the absence of such a clause, the profit sharing ratio is assumed to be equal among the partners.
- In this case, the capital contribution of each partner is different and hence, the profit sharing ratio needs to be calculated based on their capital contributions.
- A has contributed an additional amount of Rs 20,000 as an advance, which is not treated as a loan and hence, no interest is provided on it. This amount is treated as a part of A's capital contribution for the purpose of calculating the profit sharing ratio.
- The profit sharing ratio is calculated based on the capital contribution of each partner. This ratio determines the share of each partner in the profits of the firm.
- In this case, A has the highest capital contribution and hence, he gets the highest share in the profits. B and C get their shares based on their capital contributions.
- This method of sharing profits ensures that the partners are rewarded for their capital contribution and the risks associated with it.
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A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying on business in partnership the firm's reported profit for the year was rs 80000 as per provision of the indian partnership act 1932 find out the share of each partner in the above amount after taking into account that no interest has been provided on advance by a of rs 20,000 in addition to his capital contribution?
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A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying on business in partnership the firm's reported profit for the year was rs 80000 as per provision of the indian partnership act 1932 find out the share of each partner in the above amount after taking into account that no interest has been provided on advance by a of rs 20,000 in addition to his capital contribution? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying on business in partnership the firm's reported profit for the year was rs 80000 as per provision of the indian partnership act 1932 find out the share of each partner in the above amount after taking into account that no interest has been provided on advance by a of rs 20,000 in addition to his capital contribution? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying on business in partnership the firm's reported profit for the year was rs 80000 as per provision of the indian partnership act 1932 find out the share of each partner in the above amount after taking into account that no interest has been provided on advance by a of rs 20,000 in addition to his capital contribution?.
A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying on business in partnership the firm's reported profit for the year was rs 80000 as per provision of the indian partnership act 1932 find out the share of each partner in the above amount after taking into account that no interest has been provided on advance by a of rs 20,000 in addition to his capital contribution? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying on business in partnership the firm's reported profit for the year was rs 80000 as per provision of the indian partnership act 1932 find out the share of each partner in the above amount after taking into account that no interest has been provided on advance by a of rs 20,000 in addition to his capital contribution? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A b c head capitals of rs 50,000 rs 40,000 and rs 30,000 for carrying on business in partnership the firm's reported profit for the year was rs 80000 as per provision of the indian partnership act 1932 find out the share of each partner in the above amount after taking into account that no interest has been provided on advance by a of rs 20,000 in addition to his capital contribution?.
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