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Question 16 Chapter 2 of +2 Part-1 – USHA Publication 12 Class Part – 1

Question 16 Chapter 2 of +2- Part-
Q-16 - CH-2 - Usha +2 Book 2018 - Solution

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Question 16 Chapter 2 of +2-Part-1

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16. (Capital a/c’s/Interest on Drawings) Prepare Capital accounts of partners Muthu and Krishnan from the following information, assuming that their capitals are fluctuating:

 MuthuKrishnan
Capital on 1-4-1850,00035,000
Drawings during 2018-192,4001,200
Interest on Capital 6%6%
Interest on Drawings6%6%
Share in profits for 2018-197,0005,000
Salary….1,800
Commission1,000…..

The solution of Question 16 Chapter 2 of +2 Part-1: – 

Partners’ Capital Accounts 
Particulars
Muthu KrishnanParticulars
Muthu Krishnan
To Drawings A/c 2,4001,200By Balance B/d 50,00035,000
To Interest on Drawings A/c 7833By Share in profits 7,0005,000
    By Interest on Capital A/c 3,0002,100
    By Salary 1,800
    By Commission 1,000
To Balance c/d  58,52242,667    
  61,00043,900
  61,00043,900

Working Notes: –
Calculation of interest on partner’s Drawings
If partners withdrawal the same amount of drawing on a regular basis then we can calculate the interest on drawing with help of following formula: –
Interest on Drawing = Total Drawings X Rate of Interest X Period/12 Months
Rate of Interest = 6%
Period = the period/time will be calculated with the help of following formula: –

Period=Time left after 1st withdrawal+Time left after Last withdrawal
2

1. Calculation of interest on Muthu’s Drawings:

Muthu’s withdrawal at the beginning of every month = 200 p.m. Therefore, total drawings of the year= Rs.2,400.
It means 1st withdrawal has made on 01-04-2018
So, Time left from 1-4-2018 to 1-3-19 in 12 Months
And last withdrawal has made on 1-3-2019
So, Time left from 1-3-2019 to 31-3-2019 is 1 month.

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Now, 0put this time period in the formula

Period=11+1
2
Period=13
2
Period=6.5

Total Drawings = 2,400

Interest on Drawing=2,400X6X6.5
10012
       
Interest on Drawing=78    

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2. Calculation of interest on Krishnan’s Drawings:

Muthu’s withdrawal at the end of every month = 100 p.m. Therefore, total drawings of the year = Rs.1,200.
It means 1st withdrawal has made on 31-04-2018
So, Time left from 31-4-2018 to 31-3-19 in 11 Months
And last withdrawal has made on 31-3-2019
So, Time left from 31-1-3-2019 to 31-3-2019 is 0 months.
Now, put this time period in the formula:

Period=11+0
2
Period=11  
2
Period=5.5

Total Drawings = 1,200

Interest on Drawing=1,200X6X5.5
10012
       
Interest on Drawing=33    

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Comment if you have any questions.

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

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication

+2 Book 1-min
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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