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Following is the extract of the Balance Sheet of, Neelkant and Mahadev as on March 31, 2020:

Balance Sheet as at March 31, 2020

Liabilities Assets

Neelkant’s Capital

Mahadev’s Capital

Neelkant’s Current Account

Mahadev’s Current Account

Profit and Loss Appropriation (March 2017)

10,00,000

10,00,000

1,00,000

1,00,000

8,00,000

Sundry Assets 30,00,000
  30,00,000   30,00,000

During the year Mahadev’s drawings were ₹ 30,000. Profits during 2016 – 17 is ₹ 10,00,000. Calculate interest on capital @ 5% p.a. for the year ending March 31, 2020.

[Ans: Interest on Neelkant’s Capital, ₹ 50,000 and Mahadev’s Capital ₹ 50,000]

Anurag Pathak Changed status to publish March 24, 2024
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