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Question
Ram and Mohan were partners with fixed capitals of ₹ 3,00,000 and ₹ 2,00,000 respectively. As per their partnership deed, interest on capital was allowed @ 10% p.a. Net profit for the year ended 31st March, 2022 was ₹ 30,000. The amount of interest on capital was credited to each partner's current account for the year ended 31st March, 2022 was:
Options
Ram ₹ 30,000 and Mohan ₹ 20,000
Ram ₹ 20,000 and Mohan ₹ 10,000
Ram ₹ 18,000 and Mohan ₹ 12,000
Ram ₹ 30,000 and Mohan Nil
Solution
Ram ₹ 18,000 and Mohan ₹ 12,000
Explanation:
Interest on Ram's Capital `= 3,00,000 xx 10/100 = ₹ 30,000`
Interest on Mohan's Capital `= 2,00,000 xx 10/100 = ₹ 20,000`
Total Profit = 30,000
Interest to be given in ratio 30,000 : 20,000 = 3 : 2 ...[Interest will be credited in the ratio of appropriation (i.e., interest on capital)]
Interest to be credited to Ram = `30,000xx 3/5 = ₹ 18,000`
Interest to be credited to Mohan `= 20,000 xx2/5 = ₹12,000`
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