Question 26 Chapter 2 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 26 Chapter 2 of +2-A

Question 26 Chapter 2 of +2-A

26. A, B, C, and D are partners in firm sharing profits as 4 : 3: 2: 1 respectively. It earned a profit of 1,80,000 for the year ended 31st March 2018. As per the Partnership Deed, they are to charge a commission @ 20% of the profit after charging such commission which they will share as 2 : 3: 2 : 3. You are required to show appropriation of profits among the partners.

The solution of Question 26 Chapter 2 of +2-A

:

Profit and Loss Appropriation Account A/c
for the year ended 31st March 2019
Particulars
Amount Particulars
Amount
To commission A/c *1     By Profit and Loss Adjustment A/c   1,80,000
A’s 6,000        
B’s 9,000 7,800      
C’s 6,000        
D’s 9,000 30,000      
To Profit Transferred to *2          
A’s Capital 60,000        
B’s Capital 45,000        
C’s Capital 30,000        
D’s Capital 15,000 1,50,000      
    1,80,000       1,80,000

 

Working Note: –

Calculation of commission to all Partners
Net Profit before charging commission = Rs 1,80,000
Commission to all partners = 20% of the Net Profit After charging such commission

Where the commission is charged after such on profit then there will different way of the calculation shown as follow:

=Net Profit before charging a commission x  Rate
100 + Rate
=1,80,000X 20
100 + 20
=1,80,000X 20
120

Commission to Z=30,000/-

Calculation of commission to every partner

Commission sharing Ratio = 2:3:2:3 (Given)

  Total Commission Single partner share
Total of ratio
Commission to A 30,000 2
10

=6,000/-

Commission to B 30,000 3
10

=9,000/-

Commission to C 30,000 2
10

=6,000/-

Commission to D 30,000 3
10

=9,000/-

*2: -Calculation of share of profit of A’s, B’s, C’s, and D’s.
Profit-Sharing Ratio = 4:3:2:1
 Profit after Commission = 1,50,000
The profit share of A’s=1,50,000 X 4/10
=60,000/-
 Profit share of B’s=1,50,000 X 3/10
=45,000/-
Profit share of C’s=1,50,000 X 2/10
=30,000/-
Profit share of D’s=1,50,000 X 1/10
=15,000/-







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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)

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

 

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

2 Book 1 min - Question 26 Chapter 2 of +2-A - T.S. Grewal 12 Class Part - A Vol. 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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