Mohammed and Rashid are partners sharing profits in the ratio of 3:2 with capitals of OMR 50,000 and OMR 40,000 respectively. Interest on capital is agreed at 8% p.a. Interest on drawings is fixed at 10% p.a. The drawings of the partners were OMR 15,000 and OMR 10,000. Mohammed is entitled to a salary of OMR 12,000 p.a. and Rashid is entitled to get a commission of 10% on the Net Profit before charging such commission. The Net Profit of the firm before making the above adjustments was OMR 60,000 for the year ended 2021. Prepare the profit and loss appropriation account and capital Accounts
Mohammed and Rashid are partners sharing profits in the ratio of 3:2 with capitals of OMR 50,000 and OMR 40,000 respectively. Interest on capital is agreed at 8% p.a. Interest on drawings is fixed at 10% p.a. The drawings of the partners were OMR 15,000 and OMR 10,000. Mohammed is entitled to a salary of OMR 12,000 p.a. and Rashid is entitled to get a commission of 10% on the Net Profit before charging such commission. The Net Profit of the firm before making the above adjustments was OMR 60,000 for the year ended 2021. Prepare the profit and loss appropriation account and capital Accounts
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Mohammed and Rashid are partners sharing profits in the ratio of 3:2 with capitals of OMR 50,000 and OMR 40,000 respectively.
Interest on capital is agreed at 8% p.a.
Interest on drawings is fixed at 10% p.a.
The drawings of the partners were OMR 15,000 and OMR 10,000.
Mohammed is entitled to a salary of OMR 12,000 p.a. and Rashid is entitled to get a commission of 10% on the Net Profit before charging such commission.
The Net Profit of the firm before making the above adjustments was OMR 60,000 for the year ended 2021.
Prepare the profit and loss appropriation account and capital Accounts
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