Piya and Shreya are partners in a firm. Their Capital Accounts as on 1st April, 2023 were ₹ 5,00,000 and ₹ 3,00,000 respectively

Piya and Shreya are partners in a firm. Their Capital Accounts as on 1st April, 2023 were ₹ 5,00,000 and ₹ 3,00,000 respectively.

As per provisions of the Deed:

(i) Piya was entitled to a remuneration of ₹ 60,000 per year and Shreya a remuneration of ₹ 6,000 per month.

(ii) Interest on Capitals was to be provided @ 6% p.a.

Ignoring the above terms, net profit of ₹ 4,00,000 for the year ended 31st March, 2024 was distributed between the partners in the ratio of their capitals.

Pass the journal entries to rectify the above errors.

[Ans. Net profit credited to partners ₹ 1,10,000 each.]