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# Question 68 Chapter 2 of Class 12 Part – 1 VK Publication

Question 68 Chapter 2 of Class 12 Part - 1 VK Publication

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Question 68 Chapter 2 of Class 12 Part – 1

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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:

Balance sheet

 Liabilities Rs. Assets Rs. Capital A/c’s: M 50,000 Drawings : M 10,000 N 50,000 1,00,000 N 10,000 20,000 Sundry creditors 20,000 Sundry Assets 1,00,000 1,20,000 1,20,000

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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: –

Table Adjustment

 Particulars M Rs. N Rs. Closing Capitals 50,000 50,000 Less: Share of Profit (already added to the capitals) 15,000 10,000 Opening capitals 35,000 40,000 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

Table Adjustment

 Particulars Advertisement-X  M Rs. N Rs. Total ₹ Interest on Capital A/c 1,750 2,000 3,750 Less: Interest on Drawings 300 300 600 (Cr.) (A) 1,450 1,700 3,150 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

Chapter No. 1 – Accounting Not for Profit Organisations

Chapter No. 2 – Partnership Accounts – I (Introduction)

Chapter No. 3 – Partnership Accounts – II (Goodwill: Nature and Valuation)

Chapter No. 4 – Partnership Accounts – III (Reconstitution of Partnership)

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Chapter No. 5 – Partnership Accounts – IV (Admission of A Partner)

Chapter No. 6 – Partnership Accounts – V (Retirement and Death of A Partner)

Chapter No. 7 – Partnership Accounts – VI (Dissolution of Partnership Firm)

Chapter No. 8 – Company Accounts (Share Capital)

Chapter No. 9 – Company Accounts (Issue of Debentures)

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Chapter No. 10 – Company Accounts (Redemption of Debentures)

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

Chapter No. 1 – Financial Statements of a Company

Chapter No. 2 – Financial Statement Analysis

Chapter No. 3 –  Tools of Financial Statement Analysis- Comparative and Common Size

Chapter No. 4 – Ratio Analysis

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Chapter No. 5 – Cash Flow Statement

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