prepare profit and loss appropriation account for the XYZ Associates
The XYZ Associates has three partners, A, B and C. In the first half of year 1, to 30 June, 2019.
Year 1, Partner A and Partner C each received an annual salary of Rs. 35,000. Residual profits or
losses are shared between A, B and C in the ratio 4:3:2. (There is no interest on capital.) In the
second half of the year, from 1 July to 31 December, 2019, Partner A’s salary was increased to Rs.
45,000, and the partners altered the profit-sharing ratio to 1:3:1 for A:B:C).
The salary of Partner F was unchanged at Rs. 35,000 per year. The profit for the year was Rs.
230,000 (arising evenly throughout the year).
Required: You are asked to prepare
and Show the necessary calculations and also explain them.
Step by step
Solved in 2 steps
