Abhay, Siddharth and Kusum are Partners in a Firm, Sharing Profits in the ratio of 5:3:2. Kusum is Guaranteed - Bzziii.com

Abhay, Siddharth and Kusum are partners in a firm, sharing profits in the ratio of 5:3:2. Kusum is guaranteed a minimum amount of Rs 10,000 as per share in the profits. Any deficiency arising on that account shall be met by Siddharth. Profits for the years ending March 31, 2016 and 2017 are Rs 40,000 and 60,000 respectively. Prepare Profit and Loss Appropriation Account.

Profit and Loss Appropriation Account 

as on March 31, 2016

Particulars		Amount (Rs.)	Particulars	Amount (Rs.)
Profit transferred to Partner’s Capital A/c			Profit and Loss	40,000
Abhay	20,000
Siddharth	12,000
Less: Guarantee to Kusum’s	(2,000)	10,000
Kusum’s Capital	8000
Add: Deficiency received from Siddharth	2,000	10,000
	40,000			40,000

Profit and Loss Appropriation Account as on

March 31, 2017

Particulars	Amount (Rs.)	Particulars	Amount (Rs.)
Profit transferred to		Profit and Loss	60,000
Abhay’s Capital	30,000
Siddharth’s Capital	18,000
Kusum’s Capital	12,000
	60,000		60,000

Chapter-2 Partnership Basic: Accounts

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