On 1st April ,2013 jay and vijay entered into partners for supplying laboratory equipmets to government cshools situated in remove and backward areas
On 1st April ,2013 jay and vijay entered into partners for supplying laboratory equipmets to government cshools situated in remove and backward areas , they contributed capitals of Rs. 80,000 and Rs. 50,000 respectively and agreed to share to share the profit in the ratio of 3:2 the provided that interest on capital shall be allowed at 9% per annum . During the year he firm earned a profit of RS. 7,800
showing your calculations clearly propare profit loss appropriation Account of jay and vijay for the year ended 31st March , 2014 .
1 Answers
Correct Answer - Interest on capital on capital :jay -Ras. 4,80,000 : vijay -Rs. 3,000
since the amount of net profit if less than the total amount of interest on capital i.e., Rs. 72,000 (jay ) +rs. 4,5000(vijay ) =Rs. 11,500 , the net profit has been distbuted in the ratio of interest claims of jay and vijay i.e., Rs. 72,00:Rs, 4,500 or 8:5.