Shankar and Manu are partners in …

Shankar and Manu are partners in a firm .on 1st April 2014 their fixed capitals accounts showed a balance of 200000 and 400000 respectively

Posted by Avni Pareek 2 years, 7 months ago

Preeti Dabral 2 years, 7 months ago

PROFIT AND LOSS APPROPRIATION ACCOUNT
(for the year ended 31st March, 2015)

PARTNER'S FIXED CAPITAL ACCOUNTS

PARTNER'S CURRENT ACCOUNTS

Dr.					Cr.
Particulars	Shankar ₹	Manu ₹	Particulars	Shankar ₹	Manu ₹
To Drawings⁽²⁾	24,000	24,000	By Balance b/d	50,000	1,00,000
To Interest on Drawings	1,800	1,800	By Interest on Capital	25,000	40,000
To Bal c/d	2,81,145	2,68,830	By Profit & Loss Appropriation A/c	2,31,945	1,54,630
	3,06,945	2,94,630		3,06,945	2,94,630

MANU'S LOAN ACCOUNT

Working Note:

interest on Shankar's Capital = $2,00,000\times\frac{10}{100}\times\frac{9}{12}+4,00,000\times\frac{10}{100}\times\frac{3}{12}$ = 25,000
Total Drawings = 6,000 $\times$ 4 = 24,000
Interest on Drawings:
Since drawings are made at the beginning of each quarter, interest will be charged for 7.5 months: $24,000 \times \frac{12}{100} \times \frac{7.5}{12}$ = ₹1,800
If Partnership deed is silent about Interest on Loan then Interest on Loan will be allowed @6% p.a.
Interest on Loan = $1,50,000 \times \frac{6}{100} \times \frac{3}{12}$ = 2,250