Loading Tutorstips...
✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Advertisement
Advertisement
Advertisement
Advertisement
Question 39 Chapter 2 of +2-A
39. Moli and Bholi contribute 20,000 and 10,000 respectively towards the capital. They decide to
allow interest on capital @ 6% p.a. Their respective share of profits is 2 : 3 and the net profit
for the year is 1,500. Show the distribution of profits:
(i) Where there is no agreement except for interest on capitals; and
(ii) Where there is an agreement that the interest on capital as a charge.
Calculation of Interest on Moli's and Bholi’s Capital
Interest on Capital = Opening Capital X Rate of Interest
| Interest on Moli's Capital | = | 20,000 | X | 6 |
| 100 | ||||
| Interest on Moli's Capital | = | 1,200/- |
| Interest on Bholi's Capital | = | 10,000 | X | 6 |
| 100 | ||||
| Interest on Bholi's Capital | = | 600/- |
| Total Interest on Capital | = | 1,200 | + | 600 |
| Total Interest on Capital | = | 1,800 |
Case I
In this case, we have to provide an amount of interest on capital up to the amount of profit because there is no agreement between partners about interest on capital. So, that’s why we have to calculate the ratio of a partner’s interest in the capital
|
Period |
The ratio of Moli's Interest on Capital |
The ratio of Bholi's Interest on Capital |
|---|---|---|
| Interest on Capital | 1,200 | 600 |
| Ratio of interest on Capital |
2 | 1 |
| Interest on Capital | = | Total Interest on Capital or up to the amount of Profit | X | The ratio of a partner’s interest in the capital |
| Interest on Moli's Capital | = | 1,500 | X | 2 |
| 3 |
Interest on Moli's Capital = 1,000/-
| Interest on Bholi's Capital | = | 1,500 | X | 1 |
| 3 |
Interest on Bholi's Capital = 500/-
Case II
In this case, we have to provide a full amount of interest on capital because there is an agreement between partners about interest on capital. So, that’s why we have to calculate the share of loss of all partners.
Calculation of Interest on Moli's and Bholi’s Capital
| Interest on Capital | = | Opening Capital | X | Rate of Interest |
| Interest on Moli's Capital | = | 20,000 | X | 6 |
| 100 |
Interest on Moli's Capital = 1,200/-
| Interest on Bholi's Capital | = | 10,000 | X | 6 |
| 100 |
Interest on Bholi's Capital = 600/-
| Total Interest on Capital | = | 1,200 | + | 600 |
| Total Interest on Capital | = | 1,800 |
Calculation of Loss transferred to Moli's and Bholi’s Capital’s account
| Net Profit/Loss | = | Net Profit | - | Total Interest of Capital |
| Net Profit/Loss | = | Net Profit/Loss | - | 1,800 |
| Net Profit/Loss | = | 300/- |
| Loss Transferred to Moli’s Capital A/c | = | 300 | X | 2 |
| 5 |
Loss Transferred to Moli’s Capital A/c= 120/-
| Loss Transferred to Bholi’s Capital A/c | = | 300 | X | 3 |
| 5 |
Loss Transferred to Bholi’s Capital A/c = 180/-
Thanks, Please Like and share with your friends
Comment if you have any questions.
Also, Check out the solved question of previous Chapters: -
Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication
Accounting & Commerce Educator
Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "Q.No.39 | Chapter 2 – Accounting for Partnership Firms: Fundamentals | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
You can take our custom-built interactive practice quiz directly on this page to test your understanding of "Q.No.39 | Chapter 2 – Accounting for Partnership Firms: Fundamentals | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1" instantly.
