Question 61 Chapter 2 of Class 12 Part - 1 VK Publication

Question 61 Chapter 2 of Class 12 Part – 1

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The solution of Question 61 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

61. M, N and O are partners in a firm with their fixed capitals Rs. 60,000; Rs. 75,000 and Rs. 90,000 respectively. Rate of interest on capital is 10% pa. However, interest on capital was not provided during the past three years and profits of the partners were distributed in the ratio-1:2:3; 2:2:1 and 3: 2:5 for the said number of years. Pass necessary adjusting journal entry.

The solution of Question 61 Chapter 2 of Class 12 Part – 1: –

Table Adjustment

Particulars	M Rs.	N Rs.	O Rs.	Total Rs.
Total Interest on Capital payable @10% pa for 3 years (Cr.) (A)	18,000	22,500	27,000	67,500
Profit already Distributed
First year- Rs. 22,500 in 1:2:3	3,750	7,500	11,250	22,500
Second year- Rs. 22,500 in 2:2:1	9,000	9,000	4,500	22,500
Third year- Rs. 22,500 in 3:2:5	6,750	4,500	11,250	22,500
Total Profit distributed (Dr.)	19,500	21,000	27,000	67,500
Net Effect	(Dr.) 1,500	( Cr.) 1,500	NIL	NIL

Adjustment Journal Entry

Date	Particular		L . F	Dr. ₹	Cr. ₹
	M’s Current A/c	Dr.		1,500
	To N’s Capital A/c				1,500
	(Being partner’s current accounts Adjusted for three years interest on capital)