Sita and Geeta aur partners in the film sharing profit in the ratio of...
Loan Interest Calculation for Sita and Geeta Partnership
- The loan amount given by Sita and Geeta to the firm is Rs. 30,000.
- The profit-sharing ratio between Sita and Geeta is 3:2.
Calculation of Interest on Loan
- As per the partnership deed, there is no mention of interest on partner loans.
- Therefore, interest on partner loans is not applicable in this case.
Treatment of Loan in Profit Sharing
- The loan amount of Rs. 30,000 given by Sita and Geeta is considered as their capital contribution to the firm.
- This loan will be treated as their share in the profits and losses of the partnership.
- The interest on the loan will not be calculated or paid separately to Sita and Geeta.
- The partners will share the profits in the ratio of 3:2, including the loan amount in their profit-sharing ratio.
Year-End Adjustment
- The partnership agreement closes the books on 31st March every year.
- At the end of the financial year, the profits will be calculated, and Sita and Geeta will share them in the ratio of 3:2.
- The loan amount will continue to be part of their capital contribution and will affect their profit share accordingly.
In conclusion, the loan given by Sita and Geeta to the firm will be treated as their capital contribution, and the interest on the loan will not be separately calculated or paid. The profits will be shared in the ratio of 3:2, including the loan amount in the profit-sharing calculation.