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On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC
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On 1 April 2006 a and b enterd into partnership contributing capital r...
Calculation of Profit and Loss Appropriation
Calculation of Interest on Capital
- A's capital = Rs. 1000000
- B's capital = Rs. 500000
- Total capital = Rs. 1500000
- Interest on capital @8% p.a. = Rs. 120000
Calculation of Salary
- Salary for A = Rs. 4000 x 12 = Rs. 48000
- Salary for B = Rs. 4000 x 12 = Rs. 48000
Calculation of Interest on Drawings
- Interest on A's drawings = Rs. 10000
- Interest on B's drawings = Rs. 6000
- Total interest on drawings = Rs. 16000
Calculation of Net Profit
- Total income = Sales - Expenses
- Total expenses = Cost of Goods Sold + Salary + Interest on Drawings
- Net profit = Total income - Total expenses
Sharing of Profit and Loss
- Ratio of sharing profit and loss = 3:2 (A:B)
- Profit or loss to be shared = Net profit - (Interest on capital + Salary + Interest on Drawings)
- Profit or loss to be shared in the ratio of 3:2
- Amount to be credited or debited to each partner's capital account accordingly
Profit and Loss Appropriation Account
- Net profit as per Income Statement = Rs. X
- Add: Interest on capital = Rs. 120000
- Add: Salary = Rs. 96000
- Add: Interest on Drawings = Rs. 16000
- Total = Rs. Y
- Less: A's share = Rs. (3Y/5)
- Less: B's share = Rs. (2Y/5)
- Balance carried down = Rs. Z
Balance Sheet
- Fixed Assets = Rs. X
- Current Assets = Rs. Y
- Less: Current Liabilities = Rs. Z
- Capital Accounts: A = Rs. (1000000 + Share of Profit/Loss), B = Rs. (500000 + Share of Profit/Loss)
Community Answer
On 1 April 2006 a and b enterd into partnership contributing capital r...
How can p/l app. a/c b prepared without the profit for the particular year given..??p/l app. a/c is prepared at the end of each accounting year and if the firm is very new that it has not even launched it's product yet....then wat wud the partners distribute among themselves if the firm has neither made any profit nor borne any loss till yet...if the firm has just been able to break even for that particular accounting year....then atleast something shud b mentioned in the ques. regarding same....if a ques. won't contain any info. regarding the profit/loss of the firm....then wat is the point of even preparing the p/l app. a/c....when it is lacking the base required to prepare it....think practically no....
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On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC
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On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC.
On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC.
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On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC, a detailed solution for On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC has been provided alongside types of On 1 April 2006 a and b enterd into partnership contributing capital rs 1000000 and 500000 respectively. they agreed to share profit and losses in the ratio of 3:2 following information is provided regarding the partnership : 1 each partner is to be allowed a salary of rs 4000 par month. 2 interest is to be allowed on capital @8%par annum. 3 interest is to be charged rs 10000 on A's drawing and rs 6000 on B drawing . profile and loss appropriation AC theory, EduRev gives you an
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