Question
The partnership agreement between Maneesh and Girish provides that:
i. Profits will be shared equally;
ii. Maneesh will be allowed a salary of ₹400 p.m;
iii. Girish who manages the sales department will be allowed a commission equal to 10% of the net profits, after allowing Maneesh's salary;
iv. 7% interest will be allowed on partner's fixed capital;
v. 5% interest will be charged on partner's annual drawings;
vi. The fixed capitals of Maneesh and Girish are ₹1,00,000 and ₹80,000, respectively. Their annual drawings were ₹16,000 and ₹14,000, respectively. The net profit for the year ending March 31, 2015, amounted to ₹40,000.
Prepare firm's Profit and Loss Appropriation Account.

Need a full question paper?

Generate a complete, print-ready paper with questions like this in minutes — across 16+ boards, with answer keys.

Start Generating Free

Similar questions

Distinguish between the sacrificing ratio and the gaining ratio among partners.
X and Y are partners in a firm sharing profits and losses in the ratio of 3 : 2. On 1st April, 2018, they admit Z as a new partner for $\frac{1}{5}\text{th}$ share in profits. On that date, there was a balance of ₹ 1,50,000 in General Reserve and a debit balance of ₹ 20,000 in the Profit and Loss Account of the firm. Pass necessary journal entries regarding adjustment of reserve and accumulated Profit/ Loss.
A, B and C are partners ina firm sharing profits and losses in the ratio of 4 : 3 : 3. Their fixed capitals were ₹ 1,00,000, ₹ 2,00,000 and ₹ 3,00,000. respectively For the year ended 31st March, 2018 Interest on capital was credited to them @ 10% instead of 9% p.a. Pass the necessary adjusting journal entry.
In the year 2015-16, salaries paid in cash amounted to ₹ 40,000. As certain the amount chargeable to Income and Exp. A/c for the year ending on 31st March 2016 from the following additional information:
 
Oustanding Salaries on 31-3-2015
3,000
Oustanding Salaries on 31-3-2016
4,500
Prepaid Salaries on 31-3-2015
1,800
Prepaid Salaries on 31-3-2016
1,400
A, B, C, and D are partners in a firm sharing profits as 4 : 3 : 2 : 1 respectively. It earned a profit of ₹ 1,80,000 for the year ended 31st March, 2018. As per the Partnership Deed, they are to charge a commission @ 20% of the profit after charging such commission which they will share as 2 : 3 : 2 : 3.
You are required to show appropriation of profits among the partners.
Form the following particulars, calculate value of goodwill of a firm by applying Capitalisation of Average Profit Method:
  1. Profits of last five consecutive years ending 31st March are: 2018–₹ 54,000; 2017–₹ 42,000; 2016–₹ 39,000; 2015–₹ 67,000 and 2014–₹ 59,000.
  2. Capitalisation rate 20%.
  3. Net assets of the firm ₹ 2,00,000.
X and Y are partners in a firm sharing profits in the ratio of 3 : 2 with capitals of ₹ 1,20,000 and ₹ 54,000 respectively. They admitted Z as a partner with ₹ 75,000 for $\frac{1}{3}\text{rd}$ share in the profits of the firm. Adjust the capitals of the partners according to Z's capital and his share in the business. Calculate the amount of actual cash to be paid off or brought in by the old partners.
Priya and Kajal are partners in a firm, sharing profits and losses in the ratio of 5 : 3. The balance in their fixed capital accounts, on April 1, 2016 were: Priya, ₹ 6,00,000 and Kajal,₹ 8,00,000. The profit of the firm for the year ended March 31, 2017 is ₹ 1,26,000. Calculate their shares of profits:
  1. When there is no agreement in respect of interest on capital.
  2. When there is an agreement that the interest on capital will be allowed @ 12% p.a.
How will you treat the following items while preparing Income & Expenditure A/c and Balance Sheet of Non-profit Organisation.
  1. Donation for Building.
  2. Sale of Newspapers.
  3. Investment purchased.
Identify various matters that need adjustments at the time of admission of a new partner.