Mohan, Vijay and Anil are partners, the balance on their capital accountsbeing Rs. 30,000, Rs. 25,000 and Rs. 20,000 respectively. In arriving at thesefigures, the profits for the year ended March 31, 2017 amounting to Rupees24,000 had been credited to partners in the proportion in which they sharedprofits. During the tear their drawings for Mohan, Vijay and Anil wereRs. 5,000, Rs. 4,000 and Rs. 3,000, respectively. Subsequently, the following omissions were noticed:(a) Interest on Capital, at the rate of 10% p.a., was not charged.(b) Interest on Drawings: Mohan Rs. 250, Vijay Rs. 200, Anil Rs. 150 was notrecorded in the books.Record necessary corrections through journal entries.
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
Mohan, Vijay and Anil are partners, the balance on their capital accounts
being Rs. 30,000, Rs. 25,000 and Rs. 20,000 respectively. In arriving at these
figures, the profits for the year ended March 31, 2017 amounting to Rupees
24,000 had been credited to partners in the proportion in which they shared
profits. During the tear their drawings for Mohan, Vijay and Anil were
Rs. 5,000, Rs. 4,000 and Rs. 3,000, respectively. Subsequently, the following omissions were noticed:
(a) Interest on Capital, at the rate of 10% p.a., was not charged.
(b) Interest on Drawings: Mohan Rs. 250, Vijay Rs. 200, Anil Rs. 150 was not
recorded in the books.
Record necessary corrections through
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 3 images
