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

Question 41 Chapter 2 of +2- Part-
Q-41 - CH-2 - Usha +2 Book 2018 - Solution

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Question 41 Chapter 2 of +2-Part-1

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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
AmountParticulars
Amount
To Interest on Capital :  By Profit b/d 21,160
– A2,000 By interest on drawings:  
-B1,5003,500-A140 
To B’s Salary 8,000-B100240
      
To Net profit transferred to Capital a/cs     
-A (3/5)5,940    
-B (2/5)3,9609,900   
  21,400  21,400

(a)If capitals are fluctuating :

Partners’ Capital Account
Particulars
ABParticulars
AB
To Drawings A/c 6,00012,000By Profit b/d 40,00030,000
To Interest on Drawings A/c 140100By Interest on Capital A/c 2,0001,500
    By Salary 8,000
    By P&L Appropriation A/c 5,9403,960
        
To Balance c/d  41,80031,360    
  47,94043,460
  47,94043,460

 

Partners’ Capital Accounts
Particulars
ABParticulars
AB
    By Balance B/d 40,00030,000
        
To Balance c/d  40,00030,000    
  40,00030,000
  40,000 30,000

 

Partners’ Current Accounts
Particulars
ABParticulars
AB
To Drawings A/c 6,00012,000By Interest on Capital A/c 2,0001,500
To Interest on Drawings A/c 140100By Salary 8,000
    By P&L Appropriation A/c 5,9403,960
To Balance c/d  1,8001,360    
  7,94013,460
  7,94013,460

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

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

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

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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