Question 61 Chapter 2 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 61 Chapter 2 of +2-A

Question 61 Chapter 2 of +2-A

61. Ram, Mohan and Sohan sharing profits and losses equally have capitals of 1,20,000, 90,000 and 60,000 respectively. For the year ended 31st March 2019, interest was credited to them @ 6% instead of 5%.
Give adjustment Journal entry.

The solution of Question 61 Chapter 2 of +2-A

:

Date Particulars
L.F. Debit Credit
  Ram’s Capital A/c Dr   300  
  To Sohan’s Capital A/c       300
  (Being adjustment of Interest on partners′ capital made)        

 


Working Note: –

Statement Showing Adjustment of Profit required
Particulars

Ram

Mohan  Sohan
Total
Actual Amount of Interest on Capital @5% p.a. 6,000 4,500 3,000 13,500
Less: Wrong Amount of Interest on Capital @6% p.a. credited 7,200 5,400 3,600 16,200
Extra Amount credited – 1,200 – 900 – 600 -2,700
Less: Extra Amount credited in Profit sharing ratio i.e. 1:1:1 900 900 900 -2,700
  -300 300
 

Ram get extra so we have to debit his capital a/c with difference amount

 

 

Sohan get less amount, so we have to credit his capital a/c with difference amount

 

 

Calculation of Actual Amount of Interest on Ram’s, Mohan’s, & Sohan’s Capital
Interest on Capital = Opening Capital X Rate of Interest



Interest on Ram’s Capital 1,20,000 X 5
100

Interest on Ram’s Capital =6,000/-

Interest on Mohan’s Capital 90,000 X 5
100

Interest on Mohan’s Capital = 4,500/-

Interest on Sohan’s Capital 60,000 X 5
100

Interest on Sohan’s Capital = 3,000 /-

 

Calculation of the Wrong Amount of Interest on Ram’s, Mohan’s, & Sohan’s Capital

Interest on Capital = Opening Capital X Rate of Interest

Interest on Ram’s Capital 1,20,000 X 6
100

Interest on Ram’s Capital = 7,200/-

 

Interest on Mohan’s Capital 90,000 X 6
100

Interest on Mohan’s Capital = 5,400/-

Interest on Sohan’s Capital 60,000 X 6
100

Interest on Sohan’s Capital = 3,600 /-

 

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

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

  • Chapter No. 1 – Financial Statement of Not-For-Profit Organisations
  • Chapter No. 2 – Accounting for Partnership Firms – Fundamentals
  • Chapter No. 3 – Goodwill: Nature and Valuation
  • Chapter No. 4 – Change in Profit-Sharing Ratio Among the Existing Partners
  • Chapter No. 5 – Admission of a Partner
  • Chapter No. 6 – Retirement/Death of a Partner
  • Chapter No. 7 – Dissolution of a Partnership Firm

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)

  • Chapter No. 1 – Financial Statements of a Company
  • Chapter No. 2 – Financial Statement Analysis 
  • Chapter No. 3 – Tools of Financial Statement Analysis – Comparative Statements and Common- Size Statements
  • Chapter No. 4 – Accounting Ratios
  • Chapter No. 5 – Cash Flow Statement

 

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

2 Book 1 min - Question 61 Chapter 2 of +2-A - T.S. Grewal 12 Class Part - A Vol. 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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