If A, B and C entered into partnership on 1st April 2016 with capitals of Rs 10,00,000, Rs - Accountancy - Accounting for Partnership Basic Concepts

Question

If A, B and C entered into partnership on 1st April 2016 with
capitals of Rs 10,00,000, Rs 8,00,000 and Rs 5,00,000 respectively
On 1st July 2016, B advanced Rs 2,00,000 and on 1st December 2016 C
advanced Rs 1,00,000 by way of loans to the firm

The Profit and Loss account for the year ended 31 3 2017 disclosed
a profit of Rs 7,70,000 but the partners could not agree upon the
rate of interest on loans and the profit sharing ratio Prepare
partner's Capital A/cs and Loan A/cs

Neha Chopra · Accepted Answer

Dear Student

Since PSR and rate of Interest on Loan is not decided, Provisions
of Partnership act in case of absence of Partnership deed shall be
applied here and Interest would be given @ 6% and Profit and losses
shall be shared equally

Partner's Capital A/c (Fluctuating Capital)

Particulars
A
B
C
Particulars
A
B
C

Bal B/d
1,000,000
800,000
500,000

Profit and loss Appropriation
253,000
253,000
253,000

Bal C/d
1,253,000
1,053,000
753,000

1,253,000
1,053,000
753,000

Partner's Loan A/c

Date
Particulars
A
B
C
Date
Particulars
A
B
C

Balance b/d
0
0
0

01-07-16
Bank A/c
0
200,000
0

01-12-16
Bank A/c
0
0
100,000

31-03-17
Interest on Loan A/c
0
9,000
2,000

31-03-17
Bal C/d
0
209,000
102,000

0
209,000
102,000

Calculation

Profit before Interest

770000

Less: Interest on Loan

B
2,00,000 x 6% x 9/12
9000

C
1,00,000 x 6% x 4/12
2000

Profit to be distributed to
Partners

759000

Share of Profit :

A
7,59,000 x 1/3
253000

B
7,59,000 x 1/3
253000

C
7,59,000 x 1/3
253000

Regards

Partner's Capital A/c (Fluctuating Capital)
Particulars	A	B	C	Particulars	A	B	C
				Bal B/d	1,000,000	800,000	500,000



				Profit and loss Appropriation	253,000	253,000	253,000

Bal C/d	1,253,000	1,053,000	753,000

	1,253,000	1,053,000	753,000		1,253,000	1,053,000	753,000

	Partner's Loan A/c
Date	Particulars	A	B	C	Date	Particulars	A	B	C
						Balance b/d	0	0	0
					01-07-16	Bank A/c	0	200,000	0
					01-12-16	Bank A/c	0	0	100,000
					31-03-17	Interest on Loan A/c	0	9,000	2,000



31-03-17	Bal C/d	0	209,000	102,000

		0	209,000	102,000			0	209,000	102,000