Question 15 Chapter 2 of +2-A - T.S. Grewal 12 Class Part

Question 15 Chapter 2 of +2-A

Table of Contents

The solution of Question 15 Chapter 2 of +2-A:

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

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

15. Bhanu and Partab are partners sharings profits equally. Their fixed capitals as on 1st April, 2018 are ₹ 8,00,000 and ₹ 10,00,000 respectively. Their drawings during the year were ₹ 50,000 and ₹ 1,00,000 respectively. Interest on Capital is a charge and is to be allowed @ 10% p.a. and interest on drawings is to be charged @ 15% p.a. Net Profit for the year ended 31st March, 2019 was ₹ 1,20,000.
Prepare Profit and Loss Appropriation Account.

The solution of Question 15 Chapter 2 of +2-A:

Profit and Loss Appropriation Account A/c for the year ended 31st March 2019
Particulars		Amount	Particulars		Amount
To Interest on Capital A/c *1			To Profit and Loss A/c		1,20,000
Prem’s Capital	80,000		To Interest on Drawing A/c *2
Manoj’s Capital	1,00,000	1,80,000	Bhanu’s Capital	3,750
			Partap’s Capital	7,500	11,250
			To Bhanu’s Capital A/c		1,675
			48,750 × 1/2	24,375
			To Partap’s Capital A/c
			48,750 × 1/2	24,375	48,750
		1,80,000			1,80,000

Working Note: –

*1: -Calculation of Total Interest on Bhanu’s Capital and Partap’s Capital
Interest on Capital = Capital X Rate of Interest X Period
Bhanu’s Capital = 8,00,000
Rate of Interest = 10%
Period = Whole year(So we don’t need to add period in the formula)
= 18,00,000 X 10/100
Total Interest on Bhanu’s Capital = 80,000/-

Partap’s Capital = 10,00,000
Rate of Interest = 10%
Period = Whole year(So we don’t need to add period in the formula)
= 10,00,000 X 10/100
Total Interest on Partap’s Capital = 1,00,000/-

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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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