Adam, Bert and Charlie started in partnership as second hand car dealers on 6^th April 2009, sharing profits in the ratio of 2:2:1. They contributed 50,000, 30,000 and 20,000 respectively.

The loss of the firm for the year ending 31^st December 2015 was 40,000 and the profit for the year ended 31^st December 2016 was 25,000. There were no interest on Capital and salary to any partner during the 2 previous years. For the year ending 31^st December 2017 the net profit was 128,200 , interest on capital 5,000 which is considered as 5% per annum interest paid for all the 3 partners for their capital contribution and salary paid out 10,000 to all of 3 partners.

Required:

1. Allocate the Profit to Adam, Bert and Charlie after distributing their salary and interest on capital for all the 3 years?

2. Find out the basis of assessment for the 3 partners

3. Explain how to adjust the share of loss of Adam and show the adjustment in the computation?