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✦ FREE LEARNING — CLASS 11 & 12 — CBSE · PSEB — ACCOUNTS · ECONOMICS · BST ✦
Atul, Bipul and Charu are partners sharing profits equally. Bipul is guaranteed a minimum profit of ₹2,00,000 per annum. A salary is payable to Bipul of ₹10,000 per month. Net profit for the year ended 31st March, 2025 is ₹6,60,000. Prepare the Profit & Loss Appropriation Account for the year.
Profit & Loss Appropriation Account (for the year ended 31st March, 2025)
| Particulars (Dr.) | ₹ | Particulars (Cr.) | ₹ |
|---|---|---|---|
| To Salary to Bipul (₹10,000 × 12) | 1,20,000 | By Profit & Loss A/c (Net Profit) | 6,60,000 |
| To Profit transferred to Capital A/cs: | |||
| Atul (1,80,000 – 10,000) | 1,70,000 | ||
| Bipul (1,80,000 + 20,000) | 2,00,000 | ||
| Charu (1,80,000 – 10,000) | 1,70,000 | ||
| Total | 6,60,000 | Total | 6,60,000 |
Working Note: Profit after Bipul’s salary = ₹6,60,000 – ₹1,20,000 = ₹5,40,000, shared equally = ₹1,80,000 each. Bipul’s guaranteed profit share is ₹2,00,000, so deficiency ₹20,000 is borne by Atul and Charu equally (₹10,000 each).
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.80 - 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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