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Question 3 Chapter 2 of Class 12 Part – 1 VK Publication

Question 3 Chapter 2 of Class 12 Part - 1 VK Publication
Question 3 Chapter 2 of Class 12 Part - 1 VK Publication

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Question 3 Chapter 2 of Class 12 Part – 1

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3. A and B were in partnership. They had agreed that interest on Capital be allowed @ 12% p.a. and interest be changed on the Drawings at the same rate . There was no other provision in their paternship deed. A presented the following Profit and Loss Appropriation Account:
Should B accept it? In case you don’t advise him to accept it , then , redraw it. Also give the necessary entry for the rectification.

The solution of Question 3 Chapter 2 of Class 12 Part – 1: –

The redrafted Profit and Loss Appropriation Account is given below:

Profit and Loss Appreciation Account

Particulars  AmountParticulars Amount
To Interest on Capital A/c:  By Profit and Loss A/c77,280
A12,000   
B6,00018,000By Interest on B’s Drawings360
To Profit transferred to Capital A/cs    
A29,820   
B29,82059,640  

 77,640 77,640

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Notes: (i) Interest on drawings will be charged for an average period of six months.
(ii) No salary is allowed to partner A
(iii) Profit will be shared in equal ratio by partners

Adjustment Table

Particulars Amount already receivedAmount ouggt to received
 Amount Amount
Interest on Capitals12,0006,00012,0006,000
Salary15,000___
Share in Profit30,00015,00028,82029,820
 57,00021,00041,82035,820
Less: Interest on Drawings_720_360
 57,00020,28041,82035,460
     
Amount ought to be received (Cr.)AB
Less: Amount already received (Dr.)41.82035,460
Amount to be Adjusted57,00020,280
Donations received from the donors for Building(15,180)(15,180)

Profit and Loss Appreciation Account

Particulars  Dr.Cr.
Adjustment Entry   
A’s Capital A/cDr.15,180 
To B’s Capital A/c  15,180
(Being partners capital accounts adjusted )   

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

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

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Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I (Introduction)

Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)

Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)

Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)

Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)

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Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

Chapter No. 10 – Company Accounts (Redemption of Debentures)

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

Chapter No. 1 – Financial Statements of a Company

Chapter No. 2 – Financial Statement Analysis

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Chapter No. 3 –  Tools of Financial Statement Analysis- Comparative and Common Size

Chapter No. 4 – Ratio Analysis

Chapter No. 5 – Cash Flow Statement

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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