# Question 20 Chapter 2 – Unimax Class 12 Part 1 – 2021

Question 20 Chapter 2 – Unimax Class 12 Part 1

20. P and Q are partners sharing profits and losses in ration of 2 : 1 with capitals of Rs. 200000 and Rs. 100000 respectively. On 1st October, 2020, P and Q both granted loans of Rs. 80000 and Rs. 60000 respectively to the firm. Show the distribution of profits and losses for the year ending 31st March, 2021 in each of following cases.
Case 1 : If profit before charging any interest amounted to Rs. 10200.
Case 2 : If profit before charging any interest amounted to Rs. 3600.
Case 3 : If losses before charging any interest are Rs. 1800.

## The solution of Question 20 Chapter 2 – Unimax Class 12 Part 1:

Profit & Loss Account For the year ended March. 31, 2006.

 Particulars Rs. Particulars Rs. To Interest on loan– A 2400 By Net Profit 10200 – B 1800 4200 To Profit transferred to Capital A/c – P 4000 – Q 2000 6000 10,200 10,200

Case II.

Profit & Loss Account For the year ended March. 31, 2006.

 Particulars Rs. Particulars Rs. To Interest on loan By Net Profit 3600 – X 2400 By Net Loss transferred to Capital A/c – Y 1800 4200 – P 400 -Q 200 600 4200 4200

Case III.

Profit & Loss Account For the year ended March. 31, 2006.

 Particulars Rs. Particulars Rs. To Net Loss 1800 By Net Loss transferred to Capital A/c To Interest on loan – P 4000 – X 2400 -Q 2000 6000 – Y 1800 4200 6000 6000

Working Notes:

Calculation of Interest on Loan :

X = Rs. 80000 x 6% x 6/12 = Rs. 2400
Y = Rs. 60000 x 6% x 6/12 = Rs. 1800
Note : Interest @ 6% p.a. is allowed on loans granted by partners, when partnership agreement is made.

https://tutorstips.com/not-for-profit-organisations/

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