Past Adjustments Solutions

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Accounting for Partnership : Basic Concepts – Past Adjustments Solutions
37. The net profit of X, Y and Z for the year ended March 31, 2016 was ₹ 60,000 and the same was distributed among them in their agreed ratio of 3 : 1 : 1. It was subsequently discovered that the under mentioned transactions were not recorded in the books :
(i)
Interest on Capital @ 5% p.a.
(ii)
Interest on drawings amounting to X ₹ 700, Y ₹ 500 and Z ₹ 300.
(iii)
Partner’s Salary : X ₹ 1000, Y ₹ 1500 p.a.
The capital accounts of partners were fixed as : X ₹ 1,00,000, Y ₹ 80,000 and Z ₹ 60,000. Record the adjustment entry.
The necessary adjustment entries can be made in two ways.
(a)
Through Profit and Loss Adjustment Account
(b)
Directly in Partners’ Capital Accounts
(a). Through Profit and Loss Adjustment Account
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Profit and Loss Adjustment A/c
Dr.
12,000
To X’s Capital A/c
5,000
To Y’s Capital A/c
4,000
To Z’s Capital A/c
3,000
(Being Interest on Capital)
X’s Capital A/c
Dr.
700
Y’s Capital A/c
Dr.
500
Z’s Capital A/c
Dr.
300
To Profit and Loss Adjustment A/c
1,500
(Being Interest on Drawings)
Profit and Loss Adjustment A/c
Dr.
2,500
To X’s Capital A/c
1,000
To Y’s Capital A/c
1,500
(Being Salary to Partner)
X’s Capital A/c
Dr.
7,800
Y’s Capital A/c
Dr.
2,600
Z’s Capital A/c
Dr.
2,600
To Profit and Loss Adjustment A/c
13,000
(Being loss on Adjustment)
(b). Directly in Partners’ Capital Accounts
Statment Showing Net Effect of Considering Past Adjustments
Details
Amount
X
Amount

Y
Amount

Z
Total
Amount
(i) Amount which should have been credited
as interest on capital
5,000 (Cr.)
4,000 (Cr)
3,000(Cr.)
12,000 (Cr.)
(ii) Amount which should have been debited
as interest on drawings
700 (Dr.)
500 (Dr.)
300 (Dr.)
1,500 (Dr.)
(iii) Amount which should have been credited
as salary
1,000 (Cr.)
1,500 (Cr.)
1,500 (Cr.)
(iv) Total
5,300 (Cr.)
5,000 (Cr)
2,700 (Cr.)
13,000 (Cr.)
(v) Amount actually credited
by way of share of profit
(₹ 13,000 divided in the ratio 1:3:1)
7,800 (Dr.)
2,600 (Dr.)
2,600 (Dr.)
13,000 (Dr.)
(vii) Difference between (iv) and (v)
(Net Effect)
Dr. 2,500
Excess
Cr. 2,400
Short
Cr. 100
Short
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
X’s Capital A/c
Dr.
2,500
To Y’s Capital
2,400
To Z’s Capital
100
(Being adjustment to profit for omission of interest on capital, interest on drawings and salary)
Working Notes:
Interest on Capital:
X
{= ₹~1,00,000 × \dfrac{5}{100}}
= ₹ 5,000
Y
{= ₹~80,000 × \dfrac{5}{100}}
= ₹ 4,000
Z
{= ₹~60,000 × \dfrac{5}{100}}
= ₹ 3,000

38. The firm of Harry, Porter and Ali, who have been sharing profits in the ratio of 2 : 2 : 1, have existed for same years. Ali wants that he should get equal share in the profits with Harry and Porter and he further wishes that the change in the profit sharing ratio should come into effect retrospectively were for the last three year. Harry and Porter have agreement on this account.
The profits for the last three years were:
2014-15
22,000
2015-16
24,000
2016-17
29,000
Show adjustment of profits by means of a single adjustment journal entry.
The necessary adjustment entries can be made in two ways.
(a)
Through Profit and Loss Adjustment Account
(b)
Directly in Partners’ Capital Accounts
(a). Through Profit and Loss Adjustment Account
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Harry’s Capital A/c
Dr.
30,000
Porter’s Capital A/c
Dr.
30,000
Ali’s Capital A/c
Dr.
25,000
To Profit and Loss Adjustment A/c
75,000
(Being old profit debited to consider adjustment in profit sharing ratio)
Profit and Loss Adjustment A/c
Dr.
75,000
To Harry’s Capital A/c
30,000
To Porter’s Capital A/c
30,000
To Ali’s Capital A/c
25,000
(Being new profit credited to consider the adjustment in the profit sharing ratio)
(b). Directly in Partners’ Capital Accounts
Statment Showing Net Effect of Considering Past Adjustments
Details
Amount
Harry
Amount

Porter
Amount

Ali
Total
Amount
(i) Profit which should have been credited
(in the ratio 1:1:1)
25,000 (Cr.)
25,000 (Cr)
25,000(Cr.)
75,000 (Cr.)
(ii) Amount actually credited
(in the ratio 2:2:1)
30,000 (Dr.)
30,000 (Dr.)
15,000 (Dr.)
75,000 (Dr.)
(iii) Difference between (i) and (ii)
(Net Effect)
Dr. 5,000
Excess
Dr. 5,000
Excess
Cr. 10,000
Short
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Harry’s Capital A/c
Dr.
5,000
Porter’s Capital A/c
Dr.
5,000
To Ali’s Capital A/c
10,000
(Being adjustment made after considering the profit sharing ratio as 1:1:1)
Working Notes:
Profit Distributed in 2:2:1 ratio
Total Profit
= ₹ 22,000 + ₹ 24,000 + ₹ 29,000
= ₹ 75,000
Harry
{= ₹~75,000 × \dfrac{2}{5}}
= ₹ 30,000
Porter
{= ₹~75,000 × \dfrac{2}{5}}
= ₹ 30,000
Ali
{= ₹~75,000 × \dfrac{2}{5}}
= ₹ 15,000
Profit Distributed in 1:1:1 ratio
Total Profit
= ₹ 75,000
Harry
{= ₹~75,000 × \dfrac{1}{3}}
= ₹ 25,000
Porter
{= ₹~75,000 × \dfrac{3}{3}}
= ₹ 25,000
Ali
{= ₹~75,000 × \dfrac{1}{3}}
= ₹ 25,000

39. Mannu and Shristhi are partners in a firm sharing profit in the ratio of 3 : 2. Following is the balance sheet of the firm as on March 31, 2017.
Balance Sheet as at March 31, 2017
Liabilities
Amount
Assets
Amount
Mannu’s Capital
30,000
Drawings :
Shristhi’s Capital
10,000
40,000
Mannu
4,000
Shristhi
2,000
6,000
Other Assets
34,000
40,000
40,000
Profit for the year ended March 31, 2017 was ₹ 5,000 which was divided in the agreed ratio, but interest @ 5% p.a. on capital and @ 6% p.a. on drawings was omitted. Adjust interest on drawings on an average basis for 6 months. Give the adjustment entry.
The necessary adjustment entries can be made in two ways.
(a)
Through Profit and Loss Adjustment Account
(b)
Directly in Partners’ Capital Accounts
(a). Through Profit and Loss Adjustment Account
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Profit and Loss Adjustment A/c
Dr.
2,000
To Mannu’s Capital A/c
1,500
To Shrishthi’s Capital A/c
500
(Being Interest on Capital)
Mannu’s Capital A/c
Dr.
120
Shrishthi’s Capital A/c
Dr.
60
To Profit and Loss Adjustment A/c
180
(Being Interest on Drawings)
Mannu’s Capital A/c
Dr.
1,092
Shrishthi’s Capital A/c
Dr.
728
To Profit and Loss Adjustment A/c
1,820
(Being loss on Adjustment)
(b). Directly in Partners’ Capital Accounts
Statment Showing Net Effect of Considering Past Adjustments
Details
Amount
Mannu
Amount

Shrishthi
Total
Amount
(i) Amount which should have been credited
as interest on capital
1,500 (Cr.)
500 (Cr)
2,000 (Cr.)
(ii) Amount which should have been debited
as interest on drawings
120 (Dr.)
60 (Dr.)
180 (Dr.)
(iii) Total
1,380 (Cr.)
440 (Cr)
1,820 (Cr.)
(iv) Amount actually credited
by way of share of profit
(₹ 1,820 divided in the ratio 3:2)
1,092 (Dr.)
728 (Dr.)
1,820 (Dr.)
(v) Difference between (iii) and (iv)
(Net Effect)
Cr. 288
Short
Dr. 288
Excess
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Shrishthi’s Capital A/c
Dr.
280
To Mannu’s Capital A/c
280
(Being adjustment to profit for omission of interest on capital, interest on drawings)
Working Notes:
Simply put, the problem is stating that the interest on capital and interest on drawings was not considered. Also, note that the interest on drawing need to be considered for 6 months.
Interest on Capital
Mannu
{= ₹~30,000 × \dfrac{5}{100}}
= ₹ 1,500
Shrishthi
{= ₹~10,000 × \dfrac{5}{100}}
= ₹ 500
Interest on Drawings
Duration
= 6 months
Mannu
{= ₹~4,000 × \dfrac{6}{100} × \dfrac{6}{12}}
= ₹ 120
Shrishthi
{= ₹~2,000 × \dfrac{6}{100} × \dfrac{6}{12}}
= ₹ 60
Loss in Profit
= (₹ 1,500 + ₹ 500) – (₹ 120 + ₹ 60)
= ₹ 1,820
Loss adjusted to:
Mannu
{= ₹~1,820 × \dfrac{3}{5}}
= ₹ 1,092
Shrishthi
{= ₹~1,820 × \dfrac{2}{5}}
= ₹ 728

40. On March 31, 2017 the balance in the capital accounts of Eluin, Monu and Ahmed, after making adjustments for profits, drawing, etc; were ₹ 80,000, ₹ 60,000 and ₹ 40,000 respectively. Subsequently, it was discovered that interest on capital and interest on drawings had been omitted.
The partners were entitled to interest on capital @ 5% p.a. The drawings during the year were Eluin ₹ 20,000; Monu, ₹ 15,000 and Ahmed, ₹ 9,000. Interest on drawings chargeable to partners were Eluin ₹ 500, Monu ₹ 360 and Ahmed ₹ 200. The net profit during the year amounted to ₹ 1,20,000. The profit sharing ratio was 3 : 2 : 1. Record necessary adjustment entry.
In this problem, we’ve to make adjustments for Interest on Capital and Interest on Drawings.
However, to calculate the interest on capital, we need the Opening Capital.
However, in the problem, the Closing Capital is given.
So, from the Closing Capital, we need to find the Opening Capital.
We know, for the given case, that
Closing Capital
= Opening Capital
– Drawings
+ Profits
From this, the Opening Capital can be found as
Opening Capital
= Closing Capital
+ Drawings
– Profits
Calculation of Opening Capital
Eluin
Monu
Ahmed
Closing Capital
80,000
60,000
40,000
Drawings
20,000
15,000
9,000
Profit
(60,000)
(40,000)
(20,000)
Opening Capital
40,000
35,000
29,000
The necessary adjustment entries can be made in two ways.
(a)
Through Profit and Loss Adjustment Account
(b)
Directly in Partners’ Capital Accounts
(a). Through Profit and Loss Adjustment Account
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Profit and Loss Adjustment A/c
Dr.
5,200
To Eluin’s Capital A/c
2,000
To Monu’s Capital A/c
1,750
To Ahmed’s Capital A/c
1,450
(Being Interest on Capital)
Eluin’s Capital A/c
Dr.
500
Monu’s Capital A/c
Dr.
360
Ahmed’s Capital A/c
Dr.
200
To Profit and Loss Adjustment A/c
1,060
(Being Interest on Drawings)
Eluin’s Capital A/c
Dr.
2,070
Monu’s Capital A/c
Dr.
1,380
Ahmed’s Capital A/c
Dr.
690
To Profit and Loss Adjustment A/c
4,140
(Being loss on Adjustment)
(b). Directly in Partners’ Capital Accounts
Statment Showing Net Effect of Considering Past Adjustments
Details
Amount
Eluin
Amount

Monu
Amount

Ahmed
Total
Amount
(i) Amount which should have been credited
as interest on capital
2,000 (Cr.)
1,750 (Cr)
1,450 (Cr.)
5,200 (Cr.)
(ii) Amount which should have been debited
as interest on drawings
500 (Dr.)
360 (Dr.)
200 (Dr.)
1,060 (Dr.)
(iii) Total
1,500 (Cr.)
1,390 (Cr)
1,250 (Cr.)
4,140 (Cr.)
(iv) Amount actually credited
by way of share of profit
(₹ 4,140 divided in the ratio 3:2:1)
2,070 (Dr.)
1,380 (Dr.)
690 (Dr.)
4,140 (Dr.)
(v) Difference between (iii) and (iv)
(Net Effect)
Dr. 570
Excess
Cr. 10
Short
Cr. 560
Short
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Eluin’s Capital A/c
Dr.
570
To Monu’s Capital A/c
10
To Ahmed’s Capital A/c
560
(Being adjustment to profit for omission of interest on capital, interest on drawings)
Working Notes:
Profit Sharing:
Eluin
{= ₹~1,20,000 × \dfrac{3}{6}}
= ₹ 60,000
Monu
{= ₹~1,20,000 × \dfrac{2}{6}}
= ₹ 40,000
Ahmed
{= ₹~1,20,000 × \dfrac{1}{6}}
= ₹ 20,000
Interest on Capital
Eluin
{= ₹~40,000 × \dfrac{5}{100}}
= ₹ 2,000
Monu
{= ₹~35,000 × \dfrac{5}{100}}
= ₹ 1,750
Ahmed
{= ₹~29,000 × \dfrac{5}{100}}
= ₹ 1,450
Total Interest on Capital
= ₹ 2,000 + ₹ 1,750 + ₹ 1,450
= ₹ 5,200
Total Interest on Drawings
= ₹ 500 + ₹ 200
= ₹ 1,060
Profit To Be Adjusted
Interest on Capital
₹ 5,200
Interest on Drawings
(₹ 1,060)
₹ 4,140
Share of Loss in Profit:
Eluin
{= ₹~4,140 × \dfrac{3}{6}}
= ₹ 2,070
Monu
{= ₹ 4,140 × \dfrac{2}{6}}
= ₹ 1,380
Eluin
{= ₹ 4,140 × \dfrac{1}{6}}
= ₹ 690

41. Azad and Benny are equal partners. Their fixed capitals are ₹ 40,000 and , respectively. After the accounts for the year have been prepared it is discovered that interest at 5% p.a. as provided in the partnership agreement, has not been credited to the capital accounts before distribution of profits. It is decided to make an adjustment entry at the beginning of the next year. Record the necessary journal entry.
The necessary adjustment entries can be made in two ways.
(a)
Through Profit and Loss Adjustment Account
(b)
Directly in Partners’ Capital Accounts
(a). Through Profit and Loss Adjustment Account
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Profit and Loss Adjustment A/c
Dr.
6,000
To Azad’s Capital A/c
2,000
To Benny’s Capital A/c
4,000
(Being Interest on Capital)
Azad’s Capital A/c
Dr.
3,000
Benny’s Capital A/c
Dr.
3,000
To Profit and Loss Adjustment A/c
6,000
(Being loss on Adjustment)
(b). Directly in Partners’ Capital Accounts
Statment Showing Net Effect of Considering Past Adjustments
Details
Amount
Azad
Amount

Benny
Total
Amount
(i) Amount which should have been credited
as interest on capital
2,000 (Cr.)
4,000 (Cr)
6,000 (Cr.)
(v) Amount actually credited
by way of share of profit
(₹ 6,000 divided in the ratio 1:1)
3,000 (Dr.)
3,000 (Dr.)
6,000 (Dr.)
(iii) Difference between (i) and (ii)
(Net Effect)
Dr. 1,000
Excess
Cr. 1,400
Short
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Azad’s Capital A/c
Dr.
1,000
To Benny’s Capital A/c
1,000
(Being adjustment to profit for omission of interest on capital)
Working Notes:
As both Azad and Benny are equal partners, the profits should be shared in the 1:1 ratio.
Interest on Capital
Azad
{= ₹~40,000 × \dfrac{5}{100}}
= ₹ 2,000
Benny
{= ₹~80,000 × \dfrac{5}{100}}
= ₹ 4,000
Total Interest on Capital
= ₹ 2,000 + ₹ 4,000
= ₹ 6,000
Loss in Share of Profit
Azad
{= ₹~6,000 × \dfrac{1}{2}}
= ₹ 3,000
Benny
{= ₹~6,000 × \dfrac{1}{2}}
= ₹ 3,000

42. Mohan, Vijay and Anil are partners, the balances in their capital accounts being ₹ 30,000, ₹ 25,000 and ₹ 20,000 respectively. In arriving at these figures, the profits for the year ended March 31, 2017 amounting to Rupees 24,000 had been credited to partners in the proportion in which they shared profits. During the year the drawings of Mohan, Vijay and Anil were ₹ 5,000, ₹ 4,000 and ₹ 3,000, respectively. Subsequently, the following omissions were noticed:
(a)
Interest on Capital, at the rate of 10% p.a., was not charged.
(b)

Interest on Drawings: Mohan ₹ 250, Vijay ₹ 200, Anil ₹ 150 was not recorded in the books.

Record necessary corrections through journal entries.
In this problem, we’ve to make adjustments for Interest on Capital and Interest on Drawings.
However, to calculate the interest on capital, we need the Opening Capital.
However, in the problem, the Closing Capital is given.
So, from the Closing Capital, we need to find the Opening Capital.
We know, for the given case, that
Closing Capital
= Opening Capital
– Drawings
+ Profits
From this, the Opening Capital can be found as
Opening Capital
= Closing Capital
+ Drawings
– Profits
Computation of Opening Capital
Mohan
Vijay
Anil
Closing Capital
30,000
25,000
20,000
Drawings
5,000
4,000
3,000
Profit
(8,000)
(8,000)
(8,000)
Opening Capital
27,000
21,000
15,000
The necessary adjustment entries can be made in two ways.
(a)
Through Profit and Loss Adjustment Account
(b)
Directly in Partners’ Capital Accounts
(a). Through Profit and Loss Adjustment Account
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Profit and Loss Adjustment A/c
Dr.
6,300
To Mohan’s Capital A/c
2,700
To Vijay’s Capital A/c
2,100
To Anil’s Capital A/c
1,500
(Being Interest on Capital)
Mohan’s Capital A/c
Dr.
250
Vijay’s Capital A/c
Dr.
200
Anil’s Capital A/c
Dr.
150
To Profit and Loss Adjustment A/c
600
(Being Interest on Drawings)
Mohan’s Capital A/c
Dr.
1,900
Vijay’s Capital A/c
Dr.
1,900
Anil’s Capital A/c
Dr.
1,900
To Profit and Loss Adjustment A/c
5,700
(Being loss on Adjustment)
(b). Directly in Partners’ Capital Accounts
Statment Showing Net Effect of Considering Past Adjustments
Details
Amount
Mohan
Amount

Vijay
Amount

Anil
Total
Amount
(i) Amount which should have been credited
as interest on capital
2,700 (Cr.)
2,100 (Cr)
1,500 (Cr.)
5,200 (Cr.)
(ii) Amount which should have been debited
as interest on drawings
250 (Dr.)
200 (Dr.)
150 (Dr.)
600 (Dr.)
(iii) Total
2,450 (Cr.)
1,900 (Cr)
1,350 (Cr.)
5,700 (Cr.)
(iv) Amount actually credited
by way of share of profit
(₹ 5,700 divided in the ratio 1:1:1)
1,900 (Dr.)
1,900 (Dr.)
1,900 (Dr.)
5,700 (Dr.)
(v) Difference between (iii) and (iv)
(Net Effect)
Cr. 550
Short
Dr. 550
Excess
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Anil’s Capital A/c
Dr.
550
To Mohan’s Capital
550
(Being adjustment to profit for omission of interest on capital, interest on drawings)
Working Notes:
As the profit sharing ratio is not provided, we would assume that the profits are shared equally among the three partners i.e. in the ratio 1:1:1
Profit Sharing
Mohan
{= ₹~24,000 × \dfrac{1}{3}}
= ₹ 8,000
Vijay
{= ₹~24,000 × \dfrac{1}{3}}
= ₹ 8,000
Anil
{= ₹~24,000 × \dfrac{1}{3}}
= ₹ 8,000
Interest on Capital
Mohan
{= ₹~27,000 × \dfrac{10}{100}}
= ₹ 2,700
Vijay
{= ₹~21,000 × \dfrac{10}{100}}
= ₹ 2,100
Anil
{= ₹~15,000 × \dfrac{10}{100}}
= ₹ 1,500
Total Interest on Capital
= ₹ 2,700 + ₹ 2,100 + ₹ 1,500
= ₹ 6,300
Total Interest on Drawings
= ₹ 250 + ₹ 200 + ₹ 150
= ₹ 600
Profit To Be Adjusted
Interest on Capital
₹ 6,300
Interest on Drawings
(₹ 600)
₹ 5,700
Share of Loss in Profit:
Mohan
{= ₹~5,700 × \dfrac{1}{3}}
= ₹ 1,900
Vijay
{= ₹ 5,700 × \dfrac{1}{3}}
= ₹ 1,900
Mohan
{= ₹ 5,700 × \dfrac{1}{3}}
= ₹ 1,900

43. Anju, Manju and Mamta are partners whose fixed capitals were ₹ 10,000, ₹ 8,000 and ₹ 6,000, respectively. As per the partnership agreement, there is a provision for allowing interest on capitals @ 5% p.a. but entries for the same have not been made for the last three years. The profit sharing ratio during there years remained as follows:
Year
Anju
Manju
Mamta
2014
4
3
5
2015
3
2
1
2016
1
1
1
Make necessary and adjustment entry at the beginning of the fourth year i.e. April 2015 April 2017.
The necessary adjustment entries can be made in two ways.
(a)
Through Profit and Loss Adjustment Account
(b)
Directly in Partners’ Capital Accounts
(a). Through Profit and Loss Adjustment Account
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Profit and Loss Adjustment A/c
Dr.
3,600
To Anju’s Capital A/c
1,500
To Manju’s Capital A/c
1,200
To Mamta’s Capital A/c
900
(Being Interest on Capital for 3 years)
Anju’s Capital A/c
Dr.
1,400
Manju’s Capital A/c
Dr.
1,100
Mamta’s Capital A/c
Dr.
1,100
To Profit and Loss Adjustment A/c
3,600
(Being loss on Adjustment)
(b). Directly in Partners’ Capital Accounts
Statment Showing Net Effect of Considering Past Adjustments
Details
Amount
Anju
Amount

Manju
Amount

Mamta
Total
Amount
(i) Amount which should have been credited
as interest on capital
1,500 (Cr.)
1,200 (Cr)
900 (Cr.)
3,600 (Cr.)
(ii) Amount actually credited
by way of share of profit
1,400 (Dr.)
1,100 (Dr.)
1,100 (Dr.)
3,600 (Dr.)
(vii) Difference between (iv) and (v)
(Net Effect)
Cr. 100
Short
Cr. 100
Short
Dr. 200
Excess
Journal
Date
Particulars
L.F.
Debit
Amount
Credit
Amount
Mamta’s Capital A/c
Dr.
200
To Anju’s Capital
100
To Manju’s Capital
100
(Being adjustment to profit for omission of interest on capital)
Working Notes:
Interest on Capital (Yearly)
Anju
{= ₹~10,000 × \dfrac{5}{100}}
= ₹ 500
Manju
{= ₹ 8,000 × \dfrac{5}{100}}
= ₹ 400
Mamta
{= ₹ 6,000 × \dfrac{5}{100}}
= ₹ 300
Total Interest on Capital
= ₹ 500 + ₹ 400 + ₹ 300
= ₹ 1,200
Interest on Capital for 3 years
Anju
= ₹ 500 × 3
= ₹ 1,500
Manju
= ₹ 400 × 3
= ₹ 1,200
Mamta
= ₹ 300 × 3
= ₹ 900
Total
= ₹ 1,500 + ₹ 1,200 + ₹ 900
= ₹ 3,600
Loss on Profit Sharing (in 2014)
Anju
{= ₹~1,200 × \dfrac{4}{12}}
= ₹ 400
Manju
{= ₹~1,200 × \dfrac{3}{12}}
= ₹ 300
Mamta
{= ₹~1,200 × \dfrac{5}{12}}
= ₹ 500
Loss on Profit Sharing (in 2015)
Anju
{= ₹~1,200 × \dfrac{3}{6}}
= ₹ 600
Manju
{= ₹~1,200 × \dfrac{2}{6}}
= ₹ 400
Mamta
{= ₹~1,200 × \dfrac{1}{6}}
= ₹ 200
Loss on Profit Sharing (in 2016)
Anju
{= ₹~1,200 × \dfrac{1}{3}}
= ₹ 400
Manju
{= ₹~1,200 × \dfrac{1}{3}}
= ₹ 400
Mamta
{= ₹~1,200 × \dfrac{1}{3}}
= ₹ 400
Total Loss on Profit (for 3 years)
Anju
= ₹ 400 + ₹ 600 + ₹ 400
= ₹ 1,400
Manju
= ₹ 300 + ₹ 400 + ₹ 400
= ₹ 1,100
Mamta
= ₹ 500 + ₹ 200 + ₹ 400
= ₹ 1,100