Rakhi and Shikha are partners in a firm, with capitals of Rs. 2,00,000 andRs, 3,00,000 respectively. The profit of the firm, for the year ended 2016-17 isRs. 23,200. As per the Partnership agreement, they share the profit in theircapital ratio, after allowing a salary of Rs. 5,000 per month to Shikha andinterest on Partner’s capital at the rate of 10% p.a. During the year Rakhiwithdrew Rs. 7,000 and Shikha Rs. 10,000 for their personal use. As perpartnership deed, salary and interest are caption treated as charged. You are required to prepare Profit and Loss Account and Partner’s Capital Accounts.

Rakhi and Shikha are partners in a firm, with capitals of Rs. 2,00,000 andRs, 3,00,000 respectively. The profit of the firm, for the year ended 2016-17 isRs. 23,200. As per the Partnership agreement, they share the profit in theircapital ratio, after allowing a salary of Rs. 5,000 per month to Shikha andinterest on Partner’s capital at the rate of 10% p.a. During the year Rakhiwithdrew Rs. 7,000 and Shikha Rs. 10,000 for their personal use. As perpartnership deed, salary and interest are caption treated as charged. You are required to prepare Profit and Loss Account and Partner’s Capital Accounts.

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter10: Partnerships: Formation, Operation, And Basis

Section: Chapter Questions

Problem 41P

See similar textbooks

Similar questions

Amit, Babu and Charu set up a partnership firm on April 1, 2015. Theycontributed Rs. 50,000, Rs. 40,000 and Rs. 30,000, respectively as theircapitals and agreed to share profits and losses in the ratio of 3 : 2 :1. Amit is to be paid a salary of Rs. 1,000 per month and Babu, a Commission of Rs. 5,000.It is also provided that interest to be allowed on capital at 6% p.a. The drawings for the year were Amit Rs. 6,000, Babu Rs. 4,000 and Charu Rs. 2,000. Interest on drawings of Rs. 270 was charged on Amit’s drawings, Rs. 180 on Babu’s drawings and Rs. 90, on Charu’s drawings. The net profit as per Profit and Loss Account for the year ending March 31, 2015 was Rs. 35,660. Prepare the Profit and Loss Appropriation Account to show the distribution of profit amongthe partners.
Rahul, Rohit and Karan started partnership business on April 1, 2016 with capitals of Rs. 20,00,000, Rs. 18,00,000 and Rs. 16,00,000, respectively.The profit for the year ended March 2017 amounted to Rs.1,35,000 and thepartner’s drawings had been Rahul Rs. 50,000, Rohit Rs. 50,000 and KaranRs. 40,000. The profits are distributed among partner’s in the ratio of 3:2:1.Calculate the interest on capital @ 5% p.a.
Ramesh and Suresh were partners in a firm sharing profits in the ratio of theircapitals contributed on commencement of business which were Rs. 80,000 and Rs. 60,000 respectively. The firm started business on April 1, 2016.According to the partnership agreement, interest on capital and drawings are12% and 10% p.a., respectively. Ramesh and Suresh are to get a monthly salaryof Rs. 2,000 and Rs. 3,000, respectively.The profits for year ended March 31, 2017 before making aboveappropriations was Rs. 1,00,300. The drawings of Ramesh and Suresh wereRs. 40,000 and Rs. 50,000, respectively. Interest on drawings amounted toRs. 2,000 for Ramesh and Rs. 2,500 for Suresh. Prepare Profit and LossAppropriation Account and partners’ capital accounts, assuming that theircapitals are fluctuating.
Reena and Raman are partners with capitals of Rs. 3,00,000 and Rs. 1,00,000 respectively. The profit (as per Profit and Loss Account) for the year ended March 31, 2017 was Rs. 1,20,000. Interest on capital is to be allowed at 6% p.a. Raman was entitled to a salary of Rs. 30,000 p.a. The drawings of partners were Rs. 30,000 and 20,000. The interest on drawings to be charged to Reena was Rs. 1,000 and to Raman, Rs. 500.Assuming that Reena and Raman are equal partners. State their share ofprofit after necessary appropriations.
Josh and Krish are partners sharing profits and losses in the ratio of 3:1. Their capitals at the end of the financial year 2015-2016 were Rs. 1,50,000 and Rs. 75,000. During the year 2015-2016, Josh’s drawings were Rs. 20,000 and the drawings of Krish were Rs. 5,000, which had been duly debited to partner’s capitalaccounts. Profit before charging interest on capital for the year was Rs. 16,000.The same had also been debited in their profit sharing ratio. Krish had brought additional capital of Rs. 16,000 on October 1, 2015. Calculate interest on capital @ 12% p.a. for the year 2015-2016.
Lokesh and Azad are partners sharing profits in the ratio 3:2, with capitals ofRs. 50,000 and 30,000, respectively. Interest on capital is agreed to be paid @ 6% p.a. Azad is allowed a salary of Rs. 2,500 p.a. During 2016, the profitsprior to the calculation of interest on capital but after charging Azad’s salaryamounted to Rs. 12,500. A provision of 5% of profits is to be made in respect of manager’s commission. Prepare accounts showing the allocation of profits and partner’s capital accounts.
A Victoria fashion business partnership has agree that half of the annual profit be distributed in proportion to each partner's investment in the partnership, and that the other half be distributed in proportion to the total number of hours that each partner worked in the business during the year. In 2015, the profit of the company was $82,000. How should the company allocate this profit to its three investors if the amounts invested by Chloe, Arab, and Mike are $60,000, $20,000, and $50,000, and their hours of work for the year were 400, 1100, and 1300, respectively?
Amit and Bhola are partners in a firm. They share profits in the ratio of 3:2. As per their partnership agreement, interest on drawings is to be charged @ 10% p.a. Their drawings during 2017 were Rs. 24,000 and Rs. 16,000, respectively.Calculate interest on drawings based on the assumption that the amountswere withdrawn evenly, throughout the year.
Raj and Neeraj are partners in a firm. Their capitals as on April 01, 2017 were Rs. 2,50,000 and Rs. 1,50,000, respectively. They share profits equally. On July 01, 2017, they decided that their capitals should be Rs. 1,00,000 each. The necessary adjustment in the capitals were made by introducing or withdrawing cash by the partners’. Interest on capital is allowed @ 8% p.a. Compute interest on capital for both the partners for the year ending on March 31, 2018.
Triphati and Chauhan are partners in a firm sharing profits and losses in theratio of 3:2. Their capitals were Rs.60,000 and Rs.40,000 as on January 01, 2015. During the year they earned a profit of Rs. 30,000. According to the partnership deed both the partners are entitled to Rs. 1,000 per month as salary and 5% interest on their capital. They are also to be charged an interest of 5% on their drawings, irrespective of the period, which is Rs. 12,000 for Tripathi, Rs. 8,000 for Chauhan. Prepare Partner’s Accounts when, capitals are fixed.
Adrian and Nino formed a Partnership . Upon formation Adrian contributed 200,000 and Nino contributed 300,000 . At the end of the current year 2016 , Adrian and Nino's capital is 250,000 and 500,000 respectively. Their profit and loss agreement has the following provisions: The partners are given monthly salaries of 1,000 each. All partners will be given 20 % interest on original capital. Bonus of 25 % of Net Income will be given to Adrian. The balance will be divided equally A. Assuming that the company resulted in a net loss of 300, in 2016: 1. What is the share of Adrian in Net Profit or Net Loss for 2016? 2. What is the share of Nino in Net Profit or Net Loss for 2016? B. Assuming that the company resulted in a profit of 300.000 in 2016: 1. What is the share of Adrian in Net Profit or Net Loss for 2016? 2. What is the share of Nino in Net Profit or Net Loss for 2016?
Coral, Camus and Cerda are partners sharing profits in the ratio of 5:3:2, respectively. As of December 31, 2008, their capital balances were P190,000, for Coral, P160,000 for Camus, P120,000 for Ceda.On January 1, 2009, the partners admitted Cordero as new partner and according to their agreement, Cordero will contribute P160,000 in cash to the partnership and also pay P20,000 for 15% of Camu’s share. Cordero will be given a 20% share in profits while the original partners’ share will be proportionately the same as before. After the admission of Cordero, the total capital will be P660,000 and Cordero’s capital be P140,000.1. The amount of the asset revaluation upon the admission of Cordero is2. The bonus, if any, upon admission of Cordero is3. The capital of Camus after the admission of Cordero is4. The partners’ profit and ratio after the admission of Cordero shall be