Question 7 Chapter 2 – Unimax Class 12 Part 1 – 2021

Question 7Chapter 2 - Unimax Class 12 Part 1 - 2021

Question 7 Chapter 2 – Unimax Class 12 Part 1

7. Pass necessary Journal entries and prepare Profit and Loss Appropriation Account of partnership firm (having partner A and B).

Profit during 2021 (before adjustments given below) 75000
Interest on Capital A = Rs. 6000
  B = Rs. 3500
Interest on Drawings A = Rs. 2800
  B = Rs. 2500
Salary Payable A = Rs. 350 per month
  B = Rs. 550 per month
Transfer to General Reserve Rs. 2000
Profit Sharing Ratio

3 : 2

The solution of Question 7 Chapter 2 – Unimax Class 12 Part 1: 

Journal Enteries

Date Particulars   L.F. Debit Credit
  Profit and Loss A/c Dr.   75,000  
    To Profit and Loss Appropriation A/c       75,000
  (Being balance of net profit transferred to profit and loss appropriation A/c)        
  Interest on capital A/c Dr.      
    To A’s Capital A/c       6,000
    To B’s Capital A/c       3,500
  (Being interest on capital provided to partners A &B )        
  Profit and Loss Appropriation A/c Dr.   9,500  
    To Interest on capital A/c       9,500
  (Being transfer of interest on capital to Profit and Loss Appropriation A/c)        
  A’s capital A/c Dr.   2,800  
  B’s capital A/c Dr.   2,500  
    To Interest on Drawings A/c       5,300
  (Being interest charged on partners’s drawings)        

Journal Enteries

Date Particulars   L.F. Debit Credit
  Interest on Drawings A/c   Dr. 5,300  
    To Profit and Loss Appropriation A/c       5,300
  (Being transfer of interest on drawings to profit and loss appropriation A/c)        
  Salary A/c   Dr. 10800  
    To A’s Capital A/c       4200
    To B’s Capital A/c       6600
  (Being Salary provided to partners A & B)        
  Profit and Loss Appropriation A/c   Dr. 10800  
    To Salary A/c       10800
  (Being transfer out of profit to general reserve)        
  Profit and Loss Appropriation A/c   Dr. 58000  
    To A’s Capital A/c       34800
    To B’s Capital A/c       23200
  (Being distribution of profit among partners A & B in 3:2)        

https://tutorstips.com/not-for-profit-organisations/

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

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)

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

Leave a Reply

Your email address will not be published. Required fields are marked *