Question 5 Chapter 2 of Class 12 Part - 1 VK Publication

Question 5 Chapter 2 of Class 12 Part – 1

Table of Contents

The solution of Question 5 Chapter 2 of Class 12 Part – 1: –

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

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

5. Karam Singh and Suleman decided to start a partnership firm to manufacture low cost paper bags from the waste paper as plastic bags were creating many environmental problems. For this, they contributed capitals of Rs. 2,00,000 and Rs. 1,00,000 respectively on 1st April, 2012. Suleman also expressed his willingness to admit Inderjeet as a partner without capital in the firm. Inderjeet is specially abled but a very creative and intelligent friend of his. Karam Singh agreed to this. The terms of partnership were as follows:
(i) Karam Singh, Suleman and Inderjeet will share profits in the ratio of 2:2:1
(ii) Interest on capital will be provided @6% p.a.
Due to shortage of capital, Karam Singh contributed Rs. 50,000 on 30th September, 2012 and Suleman contributed Rs. 20,000 on 1st January, 2013 as additional capital. The profit of the firm for the year ended 31st March, 2013 was Rs. 2,00,300.
(a) Identify any two values which the firm wants to communicate to the society.
(b) Prepare Profit and Loss Appropriation Account of the firm for the year ending 31st March, 2013.

The solution of Question 5 Chapter 2 of Class 12 Part – 1: –

(a) Values which the firm wants to communicate to the society are (any two)
 Being sensitive towards specially abled people.
 Encouraging creative people.
 Concern for environment.
 Recycling of waste products
(b)

Profit and Loss Appreciation Account

(For the year ended 31st March,2013)

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Particulars		Amount	Particulars	Amount
To Interest on Capital A/c:			By Profit and Loss A/c	2,00,300
Karam singh’s capital A/c	13,500
Suleman’s Capital A/c	6,300	19,800
To Profit Transferred to Capital A/c’s
Karam singh’s capital A/c	72,200
Suleman’s Capital A/c	72,250
Suleman’s Capital A/c	36,100	1,80,500
		2,00,300		2,00,300

Working Notes:
Calculation of Interest on Capital
1. Karam Singh:
2,00,000 ×6/100 + 50,000 ×6/100 +6/12 = 12,000+1,500 = Rs. 13,500
2. Suleman:
1,00,000 ×6/100 + 20,000 ×6/100 +3/12 = 6,000+300 = Rs. 6,300

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