Question 41 Chapter 2 of +2 Part-1 – USHA Publication 12 Class Part – 1

Question 41 Chapter 2 of +2- Part-

Question 41 Chapter 2 of +2-Part-1

41. (Fixed and Fluctuating Capital a/c’s) On 1st January,2017, A and B entered in a partnership and contributed Rs.40,000 and Rs.30,000 respectively. They share profits and losses in the ratio of 3:2. B is to be allowed a salary of Rs.8,000 per year. Interest on capitals is to be allowed at 5% p.a. and interest is to be charged on drawings. During the year A withdrew Rs.6,000 and B Rs. 12,000 on which interest in case of A being Rs.140 and B Rs.100. Profit in 2017 before the above noted adjustments was Rs.21,160. Show the distribution of profits between the partners and prepare capital accounts when:
(a) Capitals are fluctuating.
(b) Capitals are fixed.

 

The solution of Question 41 Chapter 2 of +2 Part-1: – 

 

Profit and Loss Account A/c
Particulars
Amount Particulars
Amount
To Interest on Capital :     By Profit b/d   21,160
– A 2,000   By interest on drawings:    
-B 1,500 3,500 -A 140  
To B’s Salary   8,000 -B 100 240
           
To Net profit transferred to Capital a/cs          
-A (3/5) 5,940        
-B (2/5) 3,960 9,900      
    21,400     21,400

 

(a)If capitals are fluctuating :

 

Profit and Loss Account A/c
 
Particulars
A B Particulars
A B
To Drawings A/c   6,000 12,000 By Profit b/d   40,000 30,000
To Interest on Drawings A/c   140 100 By Interest on Capital A/c   2,000 1,500
        By Salary   8,000
        By P&L Appropriation A/c   5,940 3,960
               
To Balance c/d   41,800 31,360        
    47,940 43,460
    47,940 43,460

 

Profit and Loss Account A/c
Particulars
A B Particulars
A B
        By Balance B/d   40,000 30,000
               
To Balance c/d   40,000 30,000        
    40,000 30,000
    40,000 30,000

 

Partners’ Current Accounts
Particulars
A B Particulars
A B
To Drawings A/c   6,000 12,000 By Profit b/d   2,000 1,500
To Interest on Drawings A/c   140 100 By Interest on Capital A/c   2,000 1,500
        By Salary   8,000
        By P&L Appropriation A/c   5,940 3,960
               
To Balance c/d   1,800 1,360        
    7,940 13,460
    7,940 13,460

 

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

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

  • Chapter No. 1 – Accounting Not for Profit Organisations
  • Chapter No. 2 – Partnership Accounts – I
  • Chapter No. 3 – Partnership Accounts – II (Introduction)
  • Chapter No. 4 – Partnership Accounts – III (Goodwill: Nature and Valuation)
  • Chapter No. 5 – Partnership Accounts – IV (Reconstitution of Partnership)
  • Chapter No. 6 – Partnership Accounts – V (Admission of A Partner)
  • Chapter No. 7 – Partnership Accounts – VI (Retirement and Death of A Partner)
  • 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 (Balance Sheet Only)
  • Chapter No. 2 – Techniques of Financial Statement Analysis
  • Chapter No. 3 – Ratio Analysis 
  • Chapter No. 4 – Cash Flow Statement

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

2 Book 1 min - Question 41 Chapter 2 of +2 Part-1 - USHA Publication  12 Class Part - 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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