Q.No.63 | Chapter 2 – Accounting for Partnership Firms: Fundamentals | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1

Statement Showing Adjustment of Profit required

Particulars	Mita	Usha	Total
Amount of Interest on Capital @6% p.a.*2	8,400	7,200	15,600
Add: Commission	8,000	-	8,000
Less: Amount of Interest on Drawing @6% p.a.*3	- 480	- 360	- 840
Actual total amount due – will be distributed as	15,920	6,840	22,760
Less: - Wrongly total amount distributed in the profit-sharing ration i.e. 2: 3	- 9,104	- 13,656	22,760
	200	400	-
	Mita get less amount, so we have to credit his capital a/c with difference amount	Usha get extra so we have to debit his capital a/c with difference amount

*2 Calculation of Actual Amount of Interest on Mita's & Usha's Capital
Interest on Capital = Opening Capital X Rate of Interest

Interest on Mita's Capital	=	1,40,000	X	6
				100

Interest on Mita's Capital = 8,400/-

Interest on Usha's Capital	=	1,20,000	X	6
				100

Interest on Usha's Capital = 7,200/-

*3 Calculation of Interest on Mita’s & Usha’s Drawing

Interest on Drawing	=	Drawing X Rate of Interest X Period
Period	=	Date of withdrawal to End of Financial Year
	=	01/01/2016 to 31/03/2016
	=	3 Months

 

Interest on Mita’s Drawing	=	32,000	X	6	X	3
				100		12

Interest on Mita’s Drawing = 480/-

Interest on Usha’s Drawing	=	24,000	X	6	X	3
				100		12

Interest on Usha’s Drawing = 360/-

Also, Check out the solved question of previous Chapters: -

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

• Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
• Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
• Chapter No. 3 – Goodwill: Nature and Valuation
• Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
• Chapter No. 5 – Admission of a Partner
• Chapter No. 6 – Retirement/Death of a Partner
• Chapter No. 7 – Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 8 – Company Accounts –  Accounting for Share Capital
• Chapter No. 9 – Company Accounts – Issue of Debentures
• Chapter No. 10 – Redemption of Debentures

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 1 – Financial Statements of a Company
• Chapter No. 2 – Financial Statement Analysis 
• Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
• Chapter No. 4 – Accounting Ratios
• Chapter No. 5 – Cash Flow Statement

 

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