CBSE 2025, Compartment, Set 1

Question

Kamal, Vimal and Nirmal are partners in a firm sharing profits and losses in the ratio of 5:3:2. Their fixed capitals were ₹3,00,000, ₹2,00,000 and ₹1,00,000 respectively. Interest on capital was credited to them @ 10% p.a. instead of 8% p.a. The Adjustment Entry to rectify the error will be: A). Kamal's Current A/c Dr. 400 To Vimal's Current A/c 200 To Nirmal's Current A/c 200 B). Kamal's Current A/c Dr. 400 To Nirmal's Current A/c 400 C). Vimal's Current A/c Dr. 400 To Nirmal's Current A/c 400 D). Vimal's Current A/c Dr. 200 Nirmal's Current A/c Dr. 200 To Kamal's Current A/c 400

Edvaya · Accepted Answer

The correct answer is Vimal's Current A/c Dr. 400 To Nirmal's Current A/c 400. Excess interest credited = 10% - 8% = 2% p.a. Kamal = 2% of 3,00,000 = 6,000 Vimal = 2% of 2,00,000 = 4,000 Nirmal = 2% of 1,00,000 = 2,000 Total excess interest = 12,000. This 12,000 should have been distributed as profit in 5:3:2 ratio: Kamal gets = 6,000 Vimal gets = 3,600 Nirmal gets = 2,400 Net Effect: Kamal: Dr 6,000, Cr 6,000 = Nil Vimal: Dr 4,000, Cr 3,600 = Dr 400 Nirmal: Dr 2,000, Cr 2,400 = Cr 400 Entry: Vimal's Current A/c Dr 400 To Nirmal's Current A/c 400.

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Accountancy > Accounting For Partnership Firms > Fundamentals Of Partnership

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