Q180. Ajay, Binay & Chetan were partners sharing profits in the ratio 3:3:2. The Partnership Deed provided for the following:
(i) Salary of Rs. 2000 per quarter to Ajay & Binay.
(ii) Chetan was entitled to a commission of Rs. 8000.
(iii) Binay was guaranteed a profit of Rs. 50,000 p.a.
The profit of the firm for the year ended 31st March, 2015 was Rs. 1,50,000 which was distributed among Ajay, Binay & Chetan in the ratio 2:2:1, without taking into consideration the provisions of Partnership Deed. Pass Necessary rectifying entry for the above adjustments in the books of the firm. Show your workings clearly.
[Ans. Dr. Ajay's Capital A/c- Rs. 6400; Binay's Capital A/c. Rs. 2000; Cr. Chetan's Capital A/c. 8400].
|Ajay's Capital A/c||Dr.||6,400|
|Binay's Capital A/c||Dr.||2,000|
|To Chetan's Capital A/c||8,400|
|(Being rectification made)|
|Statement of Working of rectification|
|Distribution as per Partnership deed :|
|Profit Distribution (Note)||45,600||50,000||30,400||126,000|
|Total Credits that should have been made||53,600||58,000||38,400||150,000|
|Profit shared in (2:2:1)||60,000||60,000||30,000||150000|
|Difference : As per deed - Actual||(6,400)||(2,000)||8,400||-|
|Less : Salary of ajay and binay||16,000|
|Less : Commission of Chetan||8,000|
|Profit available for Distribution||126,000|
|As per PSR (3:3:8)|
|Profit share guaranteed to Binay to be transferred to his capital A/c||50,000|
|Deficiency to be borne by Ajay and Chetan in 3:2(PSR)||2,750|
|Deficiency share of Ajay||1,650|
|Actual profit transferred to Ajay||45,600|
|Deficiency share of Chetan||1,100|
|Actual profit transferred to Chetan||30,400|