Question 68 Chapter 2 of Class 12 Part – 1
68. M and N are partners in a firm sharing profits in the ratio 3:2 Following is their Balance Sheet as on 31st March, 2018:
|Capital A/c’s: M||50,000||Drawings : M||10,000|
|Sundry creditors||20,000||Sundry Assets||1,00,000|
Profit for the year amounted to Rs. 25,000 which was distributed regardless of crediting interest on capital at 5% pa. and debiting interest on drawings at 6% pa. Interest on drawings may be calculated on an average basis for six months.
Pass necessary adjusting entry.
The solution of Question 68 Chapter 2 of Class 12 Part – 1: –
|Less: Share of Profit (already added to the capitals)||15,000||10,000|
|Interest on Opening Capitals @5%||1,750||2,000|
Interest on Drawings for six months @6% p.a.
M = 10,000 ×6/100×6/12= Rs. 300
N = 10,000 ×6/100×6/12= Rs. 300
|N Rs.||Total ₹|
|Interest on Capital A/c||1,750||2,000||3,750|
|Less: Interest on Drawings||300||300||600|
|Less: Net loss of the firm ( Rs. 3,150 in the ratio of 3:2) (Dr.) (B)||1,890||1,260||3,150|
|Net Effect (A-B)||( Dr.) 440||(Cr.) 440||NIL|
Adjustment Journal Entry
|Date||Particular||L . F
||Dr. ₹||Cr. ₹|
|M’s Capital A/c||Dr.||440|
|To N’s Capital A/c||440|
|(Being partners’ capital account adjusted for interest on capital and drawings )|
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Also, Check out the solved question of all Chapters: –
Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution
Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution