Rakhi and Shikha are partners in a firm, with capitals of Rs. 2,00,000 andRs, 3,00,000 respectively. The profit of the firm, for the year ended 2016-17 isRs. 23,200. As per the Partnership agreement, they share the profit in theircapital ratio, after allowing a salary of Rs. 5,000 per month to Shikha andinterest on Partner’s capital at the rate of 10% p.a. During the year Rakhiwithdrew Rs. 7,000 and Shikha Rs. 10,000 for their personal use. As perpartnership deed, salary and interest are caption treated as charged. You are required to prepare Profit and Loss Account and Partner’s Capital Accounts.
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
Rakhi and Shikha are partners in a firm, with capitals of Rs. 2,00,000 and
Rs, 3,00,000 respectively. The profit of the firm, for the year ended 2016-17 is
Rs. 23,200. As per the Partnership agreement, they share the profit in their
capital ratio, after allowing a salary of Rs. 5,000 per month to Shikha and
interest on Partner’s capital at the rate of 10% p.a. During the year Rakhi
withdrew Rs. 7,000 and Shikha Rs. 10,000 for their personal use. As per
partnership deed, salary and interest are caption treated as charged. You are required to prepare
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