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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Atul and Gita were partners in a firm sharing profits and losses in the ratio of 3 : 2. Their fixed capitals were ₹4,00,000 and ₹2,00,000 respectively. After the accounts for the year were prepared, it was noticed that interest on capital @ 6% p.a., as provided in the Partnership Deed, was not credited to the Capital Accounts of the partners before the distribution of profits. Pass the necessary adjusting Journal entry. Show your workings clearly. (CBSE 2024)
JOURNAL
| Date | Particulars | L.F. | Dr. (₹) | Cr. (₹) |
|---|---|---|---|---|
| Gita’s Current A/c Dr. | 2,400 | |||
| To Atul’s Current A/c | 2,400 | |||
| (Interest on capital omitted, now adjusted) |
Adjustment Table
| Particulars | Atul (₹) | Gita (₹) | Total (₹) |
|---|---|---|---|
| Interest on capital to be credited (6%) | 24,000 | 12,000 | 36,000 |
| Less: Wrongly distributed as profit (3 : 2) | (21,600) | (14,400) | (36,000) |
| Net Effect | +2,400 (Cr.) | –2,400 (Dr.) | Nil |
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 "T.S. Grewal Class 12 Chapter 1 Q.58 - Accounting for Partnership Firm Fundamentals", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Chapter 1 - Accounting for Partnership Firm – Fundamentals.
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