Question 69 Chapter 2 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 69 Chapter 2 of +2-A

Question 69 Chapter 2 of +2-A

69. Mannu and Shristhi are partners in a firm sharing profit in the ratio of 3 : 2. The following 
information is of the firm as on 31st March 2019:

Liabilities    Rs Assets    Rs
Mannu’s Capital  30,000   Drawings:    
Shristhi’s Capital 10,000 40,000 Mannu  4,000  
      Shristhi  2,000 6,000
      Sundry Assets   34,000
    40,000     40,000

Profit for the year ended 31st March 2019 was 5,000 which was divided in the agreed ratio, but interest @ 5% p.a. on capital and @ 6% p.a. on drawings was inadvertently omitted.
Adjust interest on drawings on an average basis for 6 months. Give the adjustment entry.

 

The solution of Question 69 Chapter 2 of +2-A

:

Date Particulars
L.F. Debit Credit
  Shrishti’s Capital A/c Dr   288  
  To Mannu’s Capital A/c       288
  (Being adjustment made)        

 


Working Note: –

 

 

Statement Showing Adjustment of Profit required
Particulars Mannu

Shristhi

Total
Actual Amount of Interest on Capital @5% p.a. *2 1,500 500 2,000
Less: – Interest on Drawing *3 120 60 180
Actual Amount to be credited 1,380 440 1,820
Less: wrongly Amount credited in Profit sharing ratio i.e. 3:2 1,092 728 1,820
  288 -288
 

Mannu get less amount, so we have to credited his capital a/c with difference amount

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

 

 

*1 Calculation of Actual Amount of Interest on A’s, B’s, & C’s Capital
Interest on Capital = Opening Capital X Rate of Interest



Interest on Mannu’s Capital 30,000 X 5
100

Interest on Mannu’s Capital = 1,500/-

Interest on Shristhi’s Capital 10,000 X 5
100

Interest on Shristhi’s Capital = 500/-

*3 Calculation of Interest on Mannu’s & Shristhi’s Drawing

Interest on Drawing = Drawing X Rate of Interest X Period
Period = During the year
  = 6 Months

 

 

Interest on Mannu’s Drawing = 4,000 X 6 X 6
100 12

 

Interest on Mannu’s Drawing = 120/-

 

Interest on Shristhi’s Drawing = 2,000 X 6 X 6
100 12

 

Interest on Shristhi’s Drawing = 60/-

 

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 69 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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