10 :- Nirmal and Pawan are partners sharing profits in the ratio of 3:2. The firm had given loan to Pawan of Rs 500,000 on 1st April, 2024. Interest was to be charged @10% p.a. The firm took loan of 2,00,000 from Nirmal on 1st December, 2024. Before giving effect to the above, the firm incurred a loss of Rs 10,000 for the year ended 31st March, 2025. Determine the amount to be transferred to profit & loss appropriation Account.
Solution :- Interest on loan given to Pawan = 500,000 x 10/100 = Rs 50,000
Interest payable to Nirmal = 200,000 x 4/12 x 6/12 = Rs 4,000
Amount to be transferred to P & L appropriation A/c = profit for the year – interest payable + interest receivable
= (10,000) + 50,000 – 4,000
= Rs 36,000