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Ahmed, Bilal and Christopher set up a partnership firm on 1-1-2015. They contributed Rs. 60,000, Rs. 50,000 and Rs. 40,000 respectively as their capitals and
Ahmed, Bilal and Christopher set up a partnership firm on 1-1-2015. They contributed Rs. 60,000, Rs. 50,000 and Rs. 40,000 respectively as their capitals and decided to share profit and loss in the ratio of 3:2:1. The partnership deed provided that Ahmed is to be paid a salary of Rs. 1500 per month and Bilal a commission of Rs. 8000. It also provided that Interest on Capital be allowed at 6% per annum. The drawings for the year were Ahmed Rs 10,000, Bilal Rs 6,000 and Christopher Rs 4,000. Interest on drawing were charged Rs. 500 on Ahmed's drawings, Rs. 450 on B's drawings and Rs. 300 on Christopher's drawings. The net amounts of profit as per profit and loss account for the year 2015 was Rs 40,000. Required: Using the data given above, pass the necessary journal entries relating to the appropriation of profit and prepare the profit and loss appropriation account and the partner's separate capital accounts
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