Basics of Accounting for Partnership

2. Debit Balance Amount Credit Balance Amount
Opening stock 36000 Sales 940000
Purchases 620000 Returns outwards 4000
Return inwards 12000 Sundry Creditors 43000
Sundry Debtors 125000 Interest 1000
Computer 50000 Arti’s Capital 300000
Rent (for 11 months) 22000 Bharti’s Capital 150000
Salary of staff 120000
Land and building 352000
Wages 16000
General charges 30000
Cash at bank 25000
Arti’s drawings 20000
Bharti.s rawings 10000
Arti & Bharati are partners in a firm sharing profits in the ratio of 3:2.
The following trial balance was extracted from their books as at 31st march
2014.
Trial Balance
As at 31st march 2014

3. • You are required to prepare Trading and profit and loss
account and profit and loss appropriation account for the
year ended 31st march 2014 and a balance sheet as on that
date , taking into account the following adjustments.
• Stock on 31st march was valued at Rs. 60000.
• Rent for the month of march has not been paid.
• Depreciate computer by 20%
• Barti is to be allowed a salary of Rs.5000 per month and
partners are entitled to interest on capital @6% per annum.

4. Particulars Amount Particulars Amount
To Opening Stock
To Purchases 620000
Less: Returns
Outwards 4000
To wages
To Gross profit c/d
To Rent 22000
Add: Outstanding 2000
To Salary of staff
To General charges
To Depreciation on Computer
To net profit transferred to Profit
& Loss Appro. A/c
36000
616000
16000
320000
By Sales 940000
Less: Sales
Inwards 12000
By Closing Stock
By Gross profit b/d
By interest
928000
60000
988000 988000
24000
120000
30000
10000
137000
320000
1000
321000 321000
Trading & Profit and Loss Account
Dr for the year ended 31st march 2014 Cr.

5. Particulars Amount Particulars Amount
To Bharti’s Salary
To Interest on capital
Arti 18000
Bharti 9000
To Profit transferred to
Capital accounts
Arti 30000
Bharti 20000
60000
27000
50000
By Net profit as per
Profit and loss a/c 137000
137000 137000
Profit and Loss Appropriation Account
Dr for the year ended 31st march 2014 Cr.

6. Liabilities Amount Assets Amount
Sundry Creditors
Outstanding Rent
Arti’s Capital 300000
Less : Drawings 20000
280000
Add: Interest on
Capital 18000
Net Profit 30000
Bharti’s Capital 150000
Less : Drawings 10000
140000
Add: Interest on
Capital 9000
Net Profit 20000
Salary 60000
43000
2000
328000
229000
Cash at bank
Sundry Debtors
Closing Stock
Computer 50000
Less; Depreciation 10000
Land & Building
25000
125S000
60000
40000
352000
602000 602000
Balance Sheet of the Firm
As at 31st March 2014