69 :- Mudit, Sudhir, and Uday are partners in a firm sharing profits in the ratio of 3 : 1 : 1. Their fixed capital balances are Rs 4,00,000, ₹Rs 1,60,000, and Rs 1,20,000 respectively. Net Profit for the year ended 31st March 2018 distributed amongst the partners was Rs 1,00,000, without taking into account the following adjustments
- Interest on capitals @2.5% p.a.
- Salary to Mudit Rs 18000 pa and commission to Uday Rs 12,000
- Mudit was allowed a commission of 6% of divisible profits after charging such commission
Pass a rectifying Journal entry in the books of the firm. Show workings clearly.
Solution:-
WORKING NOTES :-
Calculation of Mudit’s commission
Divisible profit = Net profit – Interest on partners capital -Partner’s salary – Partner’s Commission
= 1,00,000 – 17,000 – 18,000 – 12,000
= Rs 53,000
Mudit’s commission = 53,000 x 6/106 = Rs 3,000