Question 4 Chapter 2 – Unimax Class 12 Part 1 – 2021

Question 4 Chapter 2 - Unimax Class 12 Part 1 - 2021

Question 4 Chapter 2 – Unimax Class 12 Part 1

4. Partners P and Q have Capitals Rs. 400000 and Rs. 300000 respectively as on 1st January, 2021. P advanced Rs. 20000 to Partnership firm on 1st July, 2021 as loan. There was no agreement as to payment of interest on loan. The profits for year ended 31st December, 2021 amounted to Rs. 52000 prior to provision for interest, if any, either upon loan or capital. 20% of this profit is to be transferred to a reserve account. The partners cannot agree either as to proportion in which profits are to be divided or upon question of interest. How will you divide profits assuming that there is no Partnership deed.

The solution of Question 4 Chapter 2 – Unimax Class 12 Part 1:

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

Liabilities   Amount Assets Amount
To General Reserve   10400 By Net Profit (after charging interest on loan) 51,400
To Net Profit        
– P 20500      
– Q 20500 41000    
    51,400   51,400

  Working Notes :
Contribution General Reserve = Rs. 52,000 x 20%
                                                   = Rs. 10,400

(2) Interest on Loan                = Rs. 20,000 x 6% x6/12
                                                   =Rs. 600

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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