Amal, Asma and Maali started a Partnership Firm on January 1, 2021 with capital OMR 30,000 OMR 20,000 and OMR 10,000 respectively and share profits in the ratio of 3:2:1. The Partnership Deed provided that Asma is to be paid Salary of OMR 200 p.m. and Amal Commission of OMR 1,000. It also provided that Interest on Capital be allowed @ 5% p.a. The Drawings for the year were: Amal OMR 1,000, Asma OMR 5,000 and Maali OMR 3,000. Interest on Drawings was OMR 100 for Amal, OMR 50 for Asma and OMR 30 for Maali. The net amount of profit as per the Profit and Loss Account for the year ended 2021 was OMR 24,000. You are required to record the necessary journal entries relating to appropriation of profit and prepare the profit and loss appropriation account and the partners' capital accounts.
Amal, Asma and Maali started a Partnership Firm on January 1, 2021 with capital OMR 30,000 OMR 20,000 and OMR 10,000 respectively and share profits in the ratio of 3:2:1. The Partnership Deed provided that Asma is to be paid Salary of OMR 200 p.m. and Amal Commission of OMR 1,000. It also provided that Interest on Capital be allowed @ 5% p.a. The Drawings for the year were: Amal OMR 1,000, Asma OMR 5,000 and Maali OMR 3,000. Interest on Drawings was OMR 100 for Amal, OMR 50 for Asma and OMR 30 for Maali. The net amount of profit as per the Profit and Loss Account for the year ended 2021 was OMR 24,000. You are required to record the necessary journal entries relating to appropriation of profit and prepare the profit and loss appropriation account and the partners' capital accounts.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Amal, Asma and Maali started a Partnership Firm on January 1, 2021 with capital OMR 30,000 OMR 20,000 and OMR 10,000 respectively and share profits in the ratio of 3:2:1. The Partnership Deed provided that Asma is to be paid Salary of OMR 200 p.m. and Amal Commission of OMR 1,000. It also provided that Interest on Capital be allowed @ 5% p.a. The Drawings for the year were: Amal OMR 1,000, Asma OMR 5,000 and Maali OMR 3,000. Interest on Drawings was OMR 100 for Amal, OMR 50 for Asma and OMR 30 for Maali. The net amount of profit as per the Profit and Loss Account for the year ended 2021 was OMR 24,000.
You are required to record the necessary journal entries relating to appropriation of profit and prepare the profit and loss appropriation account and the partners' capital accounts.
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