Page 35 - ISCDEBK-12

Partnership Accounts—Fundamentals 1.25

10. The partners of a firm distributed the profit for the year ended 31st March, 2020, ` 90,000 in the ratio
of 3 : 2 : 1 without providing for the following adjustments:
(i) Akash and Bhupesh were entitled to a salary of ` 1,500 p.a. each.
(ii) Bhupesh was entitled to a commission of ` 4,500.
(iii) Bhupesh and Chander had guaranteed a minimum profit of ` 35,000 p.a. to Akash.
(iv) Profits were to be shared in the ratio of 3 : 3 : 2.
Pass necessary Journal entry for the above adjustments in the books of the firm.

GUIDE TO ANSWERS

1. Interest credited to Anita’s and Lalita’s Loan Accounts—` 2,250 each; Interest debited to Manju’s Current
Account—` 1,500.
[Hints: 1. Interest on loan from partners is not paid. It will be credited to their respective Loan Accounts.
2. Interest on loan given to Manju will be debited to her Current Account, as the capitals
are fixed.]
2. Share of Profit: Akhil—` 18,250; and Supreet—` 18,250; Capital Accounts: Akhil—` 62,250;
Supreet—` 1,02,750.
3. Share of Profit: Satish—` 5,400; Parkash—` 4,600; Capital Accounts: Satish—` 50,000; Parkash—
` 30,000; Satish’s Current Account (Cr.) ` 7,480 and Parkash’s Current Account (Cr.) ` 5,020; Interest
on Drawings: Satish—` 120, Parkash—` 80.
4. Share of Profit: Ram—` 3,66,780; Shyam—` 3,66,780 and Mohan—` 1,83,390; Ram’s Commission—
` 52,500; Shyam’s Commission—` 50,000; Interest on Drawings: Ram—` 105, Mohan—` 150 and
Shyam—` 135.
5. Share of Profit: Prateet—` 12,900; Namrata—` 7,740; Shubhrata—` 5,160.
6. Share of Profit: X—` 4,00,000; Y—` 4,00,000; Z—` 2,00,000; Interest on Drawings: X—` 32,250;
Y—` 36,000 and Z—` 29,250; Balance of Partners’ Capital Accounts: X—` 16,00,000; Y—` 10,00,000
and Z—` 6,00,000; Balance of Partners’ Current Accounts: X—` 3,87,750; Y—` 5,94,000; Z—` 1,29,250
(Dr. Balance).
7. Net Distributable Profit—` 20,455; Transferred to Reserve Fund—` 6,818; Share of Profit: X—` 10,228;
Y—` 6,136; Z—` 4,091; Z’s Commission—` 2,727; Closing Balances of Capital Accounts: X—` 1,15,728;
Y—` 67,836; Z—` 49,618.
8.
Particulars Dhoni (`) Modi (`) Soni (`)

Share of Profit 38,720 38,720 19,360
Interest on Drawings 450 300 300
Interest on Capital 11,250 10,500 9,750
Capital Accounts (Balance) 1,75,000 1,75,000 1,75,000
Current Accounts (Balance) 35,520 62,920 20,810

9. Share of Profit: A—` 6,183; B—` 3,825; C—` 2,502; Deficiency borne by A—` 192.
10. Akash’s Capital A/c (Dr.)—` 8,500; Bhupesh’s Capital A/c (Cr.)—` 4,500; Chander’s Capital A/c (Cr.)—` 4,000.