Page 226 - AAAXII

Model Test Papers M.215

12. PROFIT AND LOSS APPROPRIATION ACCOUNT
Dr. for the year ended 31st March, 2018 Cr.
Particulars ` Particulars `
To Interest on Capital A/cs: By Profit and Loss A/c 6,70,000
A 14,000 (Net Profit)
B 7,000
C 4,200
D 2,800 28,000
To A’s Salary 12,000
To Profit transferred to:
A’s Capital A/c 2,54,600
B’s Capital A/c 1,93,000
C’s Capital A/c 87,400
D’s Capital A/c 95,000 6,30,000
6,70,000 6,70,000
JOURNAL
Date Particulars L.F. Dr. (`) Cr. (`)
2018 For Deficiency of B’s Share:
March 31 A’s Capital A/c ...Dr. 7,800
C’s Capital A/c ...Dr. 2,600
D’s Capital A/c ...Dr. 2,600
To B’s Capital A/c 13,000
(Being the deficiency in B’s Share adjusted)
For Deficiency of D’s Share:
A’s Capital A/c ...Dr. 7,600
To D’s Capital A/c 7,600
(Being the deficiency in D’s Share adjusted)
Working Notes:
1. Calculation of Deficiency of B’s Share: `
B’s Share of Profit = ` 6,30,000 × 2/7 = 1,80,000
Interest on Capital = ` 1,00,000 × 7/100 = 7,000
Share of Profit + Interest on Capital = 1,87,000
Deficiency = ` 2,00,000 (Guaranteed Profit) – ` 1,87,000 = ` 13,000.
2. Calculation of Deficiency of D’s Share: `
D’s Share of Profit = ` 6,30,000 × 1/7 = 90,000
Less: B’s Deficiency = ` 13,000 × 1/5 = 2,600
Share of Profit after B’s Deficiency = 87,400
Deficiency = ` 95,000 (Guaranteed Profit) – ` 87,400 = ` 7,600.
3. Calculation of Share of Profit:
(i) A’s Share = (` 6,30,000 × 3/7 = ` 2,70,000 – ` 7,800 – ` 7,600) = ` 2,54,600.
(ii) B’s Share = (` 6,30,000 × 2/7 = ` 1,80,000 + ` 13,000) = ` 1,93,000.
(iii) C’s Share = (` 6,30,000 × 1/7 = ` 90,000 – ` 2,600) = ` 87,400.
(iv) D’s Share = (` 6,30,000 × 1/7 = ` 90,000 – ` 2,600 + ` 7,600) = ` 95,000.