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Imran , Irphan and Issa started a partnership firm on January 1 , 2019. They contributed RO 25,000 RO 20,000 and RO 15,000 respectively as
Imran , Irphan and Issa started a partnership firm on January 1 , 2019. They contributed RO 25,000 RO 20,000 and RO 15,000 respectively as their capitals and decided to share profits in the ratio of 3 : 2 : 1 . The partnership deed provided that Imran is to be paid salary of RO 500p.m. and Irphan is to be paid a commission of RO 2,500 . It also provided that interest on capital be allowed @ 8 % p.a. The drawings for the year were : Imran RO 3,000 , Irphan RO 2,000 and Issa RO 500. Interest on drawings was charged @ S % to all partners . The net amount of profit as per the profit and loss account for the year ended 2019 was RO 35,660 . Required : Prepare the necessary journal entries relating to Profit and Loss Appropriation .
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