On 31st March 2014, the balances in the capital accounts of Saroj, Mahiner, and Umar after making adjustments for profits and drawings, etc., were ₹ 80,000, ₹ 60,000, and ₹ 40,000 respectively. Subsequently, it was discovered that the interest on capital and drawings has been omitted.
On 31st March 2014, the balances in the capital accounts of Saroj, Mahinder, and Umar after making adjustments for profits and drawings, etc., were ₹ 80,000, ₹ 60,000, and ₹ 40,000 respectively. Subsequently, it was discovered that the interest on capital and drawings has been omitted.
a) The profit for the year ended 31st March 2014 was ₹ 80,000.
b) During the year Saroj and Mahiner each withdrew a sum of ₹ 24,000 in equal installments at the end of each month and Umar withdrew ₹ 36,000.
c) The interest on drawings was to be charged @ 5% p.a. and interest on capital was to be allowed @ 10% p.a.
d) The profit-sharing ratio among partners was 4 :3 : 1.
Showing your workings clearly, pass the necessary rectifying entry.