88 :- Ajay, Binay and Chetan were partners sharing profits in the ratio of 3:3:2. The partnership deed provided for the following:
- Salary of Rs 2,000 per quarter to Ajay and Binay.
- Chetan was entitled to a commission of Rs 8,000
- Binay was guaranteed a profit of Rs 50,000 p.a.
The profit of the firm for the year ended 31st March, 2015 was Rs 1,50,000 which was distributed among Ajay, Binay and Chetan in the ratio of 2:2:1, without taking into consideration the provisions of partnership deed. Pass the necessary rectifying entry for the above adjustments in the books of the firm. Show your workings clearly.
Solution :-
WORKING NOTES :-
Salary of Ajay Rs 8,000
Salary of Vinay Rs 8,000
Commission of Chetan Rs 8,000
Distributable profit 1,50,000 – 24,000 = Rs 1,26,000
Binay’s share in profit 1,26,000 x 3/8 = Rs 47,250
Deficiency in Binay’s share of profit 50,000 – 47,250 =Rs 2,750
Deficiency in Binay’s profit is borne by Ajay and Vinay in 3:2
Ajay will bear = 2,750 x 3/5 = Rs 1,650
Vinay will bear = 2,750 x 2/5 = Rs 1,100