Question 42 Chapter 2 - Unimax Class 12 Part 1 - 2021

Question 42 Chapter 2 – Unimax Class 12 Part 1

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The solution of Question 42 Chapter 2 – Unimax Class 12 Part 1:

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

42. Ketak, Varun and Mohit are in partnership sharing profits and losses in ratio 5 : 3 : 2. Their Capitals as on 1st April, 2020 were Rs. 200000, 150000 and Rs. 75000 respectively. Their partnership deed provides the following :
(i) Partners are to be allowed interest on Capital 10% per annum.
(ii) Interest on Drawing is charged @ 20% per annum.
(iii) Ketak is entitled to a Salary of Rs. 1500 per month for use of his premises by firm which has already been paid in cash.
(iv) Varun is entitled to a Salary of Rs. 1000 per month.
(v) Mohit is entitled to a commission of 10% of net profit before charging such commission but after providing other above given clauses.
During the year Ketak withdrew Rs. 1000 in beginning of each month. Varun and Mohit’s drawing in year were Rs. 30000 and Rs. 40000 respectively.
The net profit of the firm for the year ended 31st March, 2021 before providing any of above clause was Rs. 175000.

The solution of Question 42 Chapter 2 – Unimax Class 12 Part 1:

Profit & Loss of Appropriation A/c of firm For the year ended 31st March., 2021

Particulars		Rs.	Particulars		Rs.
To Interest on Capital			By Net Profit b/d		175000
– Ketak	20000		By Interest on Drawings A/c
– Varun	15000		Ketak	1300
– Mohit	7500	42500	Varun	3000
To Rent (Ketak) (Rs. 1500 x 12)		18000	Mohit	4000	8300
To Salary (Varun) (Rs. 1000 x 12)		12000
To Commission (Mohit) (110800 x 10/100)		11080
To Profit transferred
Ketak	49860
Varun	29916
Mohit	19944	99720
		183300			183300

Partner’s Capital Accounts

Particulars	Ketak	Varun	Mohit	Particulars	Ketak	Varun	Mohit
To Drawings	12000	30000	40000		200000	150000	75000
To Interest on Drawings	1300	3000	4000	By Interest on Capital	20000	15000	7500
To Balance c/d	256560	173916	69524	By Salaries A/c		12000
				By Commission A/c			11080
				By Profit & Loss Appropriaton A/c	49860	29916	19944

	269860	2069150	113524		269860	2069150	113524
				By Balance b/d	269860	2069150	113524

Working Notes :

(1) Interest on Capitals @ 10% p.a.
Ketak : Rs. 200000 x 10/100 = Rs. 20000
Varun : Rs. 150000 x 10/100 = Rs. 15000
Mohit : Rs. 75000 x 10/100 = Rs. 7500

(2) Interest on Partner’s Drawings
Ketak : Rs. 12000 x 20/100 x 6.5/12 = Rs. 1300
Varun : Rs. 30000 x 20/100 x 6/12 = Rs. 3000
Mohit : Rs. 40000 x 20/100 x 6/12 = Rs. 4000

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)