12th
Q12. Kavita, Meenakshi and Gauri are partners doing a paper business in Ludhiana. After the accounts of partnership have been drawn up and closed, it was discovered that for the year ending 31stMarch 2013 and 2014. Interest on capital has been allowed to partners @ 6% p.a although there is no provision for interest on capital in partnership deed. Their fixed capitals were Rs. 2,00,000; Rs. 1.60,000 and Rs. 1,20,000 respectively. During the last years they had shared the profit as under:
Year Ratio
31 March 2013 3 : 2 : 1
31 March 2014 5 : 3 : 2
You are requied to given necessary adjusting entry on April 1, 2014.
Dear Student
Regards
Journal | ||||
Date | Particulars | Debit | Credit | |
Meenakshi's Capital A/c | Dr. | 960 | ||
Gauri's Capital A/c | Dr. | 3,840 | ||
To Kavita's Capital A/c | 4,800 | |||
(Being adjustment made) |
Calculation of Net Effect of Adjustments on the Partners Capital Accounts | ||||
Particulars | Kavita | Meenakshi | Gauri | Total |
Amount already credited | ||||
As Interest on Capital | ||||
2012-13 | 12,000 | 9,600 | 7,200 | 28,800 |
2013-14 | 12,000 | 9,600 | 7,200 | 28,800 |
A.Total amount credited wrongly | 24,000 | 19,200 | 14,400 | 57,600 |
Items to be actually credited (Both years) | ||||
As profit : | ||||
2012-13 (3:2:1) | 14,400 | 9,600 | 4,800 | 28,800 |
2013-14 (5:3:2) | 14,400 | 8,640 | 5,760 | 28,800 |
B.Total Amount that should have been credited | 28,800 | 18,240 | 10,560 | 57,600 |
Net Effect to be given (A - B) | (4,800) | 960 | 3,840 | |
Credit | Debit | Debit |
Regards