Prepare the Profit and Loss Appropriation Account given the following information for a partnership firm.

Hey Aryan, good to see you again. Here's the solution for the partnership accounting problem. Step 1: Calculate appropriations Interest on Capital: A's Interest on Capital = ₹50,000 × (6)/(100) = ₹3,000 B's Interest on Capital = ₹30,000 × (6)/(100) = ₹1,800 A's Commission: A's Commission = ₹3,00,000 × (2)/(100) = ₹6,000 B's Salary: B's Salary = ₹500 × 12 = ₹6,000 B's Commission: Profit before B's commission (after other appropriations) = Net Profit - Interest on Capital - A's Commission - B's Salary Profit before B's commission = ₹50,000 - ₹(3,000 + 1,800) - ₹6,000 - ₹6,000 Profit before B's commission = ₹50,000 - ₹4,800 - ₹6,000 - ₹6,000 = ₹33,200 B's Commission (after charging such commission) = ₹33,200 × (5)/(100+5) = ₹33,200 × (5)/(105) = ₹1,580.95 ≈ ₹1,581 Step 2: Prepare Profit and Loss Appropriation Account l r r 3cProfit and Loss Appropriation Account \\ 3cFor the year ended 31st March, 2015 \\ Particulars & Amount (₹) & Amount (₹) \\ To Interest on Capital: & & \\ A & 3,000 & \\ B & 1,800 & 4,800 \\ To A's Commission & & 6,000 \\ To B's Salary & & 6,000 \\ To B's Commission & & 1,581 \\ To Partners' Capital A/cs (Divisible Profit): & & \\ A & 23,714 & \\ B & 7,905 & 31,619 \\ Total & & 50,000 \\ l r r 3c \\ Particulars & Amount (₹) & Amount (₹) \\ By Net Profit (as per P&L A/c) & & 50,000 \\ & & \\ & & \\ & & \\ & & \\ & & \\ & & \\ & & \\ Total & & 50,000 \\ Step 3: Calculate Divisible Profit and distribute it Total appropriations = ₹4,800 + ₹6,000 + ₹6,000 + ₹1,581 = ₹18,381 Divisible Profit = Net Profit - Total appropriations Divisible Profit = ₹50,000 - ₹18,381 = ₹31,619 Profit sharing ratio is 3:1. A's Share of Profit = ₹31,619 × (3)/(4) = ₹23,714.25 ≈ ₹23,714 B's Share of Profit = ₹31,619 × (1)/(4) = ₹7,904.75 ≈ ₹7,905 Step 4: Prepare Partners' Capital Accounts l r r r r 5cPartners' Capital Accounts \\ Particulars & A (₹) & B (₹) & Particulars & A (₹) & B (₹) \\ To Drawings & 8,000 & 6,000 & By Balance b/d & 50,000 & 30,000 \\ To Balance c/d & 74,714 & 41,286 & By Interest on Capital & 3,000 & 1,800 \\ & & & By Commission & 6,000 & 1,581 \\ & & & By Salary & - & 6,000 \\ & & & By P&L Appropriation A/c & 23,714 & 7,905 \\ Total & 82,714 & 47,286 & Total & 82,714 & 47,286 \\ Final Answers: B's Commission: ₹1,581 Divisible Profit: A's Share: ₹23,714 B's Share: ₹7,905 Closing Capital Balances: A's Capital: ₹74,714 B's Capital: ₹41,286 Drop the next question! 📸