FUNDAMENTALS OF PARTNERSHIP FIRM TS GREWAL (2022-23) CBSE

QUESTION: 8

X and Y are partners sharing profits and losses in the ratio of 2:3 with capitals of ₹ 2,00,000 and ₹ 3,00,000 respectively. On 1st October, 2021, X and Y gave loans of ₹ 80,000 and ₹ 40,000 respectively to the firm. Show distribution of profits/losses for the year ended 31st March, 2022 in each of the following alternative cases:

Case 1. If the profit before interest for the year amounted to ₹ 21,000.

Case 2. If the profit before interest for the year amounted to ₹ 3,000.

Case 3. If the profit before interest for the year amounted to ₹ 5,000.

Case 4. If the loss before interest for the year amounted to ₹ 1,400.

Answer:

CASE – I

Interest on X’s loan to firm = 80,000 x 6/100 x 6/12 = ₹ 2,400/-

Interest on Y’s loan to firm = 40,000 x 6/100 x 6/12 = ₹ 1,200/-

Distributable Profit = 21,000 – 3,600 = ₹ 17,400/-

X’s share in Profit = 17,400 x 2/5 = ₹ 6,960/-

Y’s share in Profit = 17,400 x 3/5 = ₹ 10,440/-

CASE – II

Interest on X’s loan to firm = 80,000 x 6/100 x 6/12 = ₹ 2,400/-

Interest on Y’s loan to firm = 40,000 x 6/100 x 6/12 = ₹ 1,200/-

Distributable Loss = 3,000 – 3,600 = ₹ -600/-

X’s share in Loss = 600 x 2/5 = ₹ 240/-

Y’s share in Loss = 600 x 3/5 = ₹ 360/-

CASE – III

Interest on X’s loan to firm = 80,000 x 6/100 x 6/12 = ₹ 2,400/-

Interest on Y’s loan to firm = 40,000 x 6/100 x 6/12 = ₹ 1,200/-

Distributable Profit = 5,000 – 3,600 = ₹ 1,400/-

X’s share in Profit = 1,400 x 2/5 = ₹ 560/-

Y’s share in Profit = 1,400 x 3/5 = ₹ 840/-

CASE – IV

Interest on X’s loan to firm = 80,000 x 6/100 x 6/12 = ₹ 2,400/-

Interest on Y’s loan to firm = 40,000 x 6/100 x 6/12 = ₹ 1,200/-

Distributable Loss = 1,400 + 3,600 = ₹ 5,000/-

X’s share in Loss = 5,000 x 2/5 = ₹ 2,000/-

Y’s share in Loss = 5,000x 3/5 = ₹ 3,000/-