Question 22 Chapter 2 – Unimax Class 12 Part 1 – 2021

Question 22Chapter 2 - Unimax Class 12 Part 1 - 2021

Question 22 Chapter 2 – Unimax Class 12 Part 1

22. A and B are partners sharing profits in the ration of 3 : 2 with capitals of Rs. 50000 and Rs. 30000 respectively. Interest on Capital is agreed at 6% per annum. B is to be allowed an annual salary of Rs. 2500. During 2021 the profits of the year prior to calculation of interest on capital but after charging B’s salary amounted to Rs. 12500.
A provision of 5% of the profits (before charging any commission) is to be made in respect of A’s Commission.
Prepare an account showing allocation of profits and partners’ capital accounts.

The solution of Question 22 Chapter 2 – Unimax Class 12 Part 1:

Profit & Loss of proprition A/c For the year ended 31st Dec., 2006

Particulars   Rs. Particulars Rs.
To Interest on Capital     By Net Profit 12500
A 3000      
B 1800 4800    
To A’s Capital A/c (Commission)
(Rs. 12500 – Rs. 4800) x 5/100
  385    
To Profit transferred to capital A/cs        
A 4389      
B 2926 7315    
    12500   12500

Capital Accounts

Particulars A B Particulars A B
To Balance o/d 57774 37226 By Balance b/d 50000 30000
      By Interest on capital 3000 1800
      By Commission A/c 385
      By Salary A/c 2500
      By Profit & Loss appropriation A/c 4389 2926
           
  57774 37226   57774 37226

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)

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

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

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

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