Profit Distribution

The governing concept is proportionate distribution when the total claims for interest on capital exceed the available profit. The claims are Rs 24,000, Rs 36,000 and Rs 30,000, giving a total of Rs 90,000, while only Rs 60,000 is available. Each partner therefore receives the same proportion, 60,000/90,000 = 2/3, of the claim. C’s amount is Rs 30,000 × 2/3 = Rs 20,000. Thus option A is correct. Option B pays C the full claim despite insufficient profit; option C uses A’s claim; and option D applies an incorrect proportion.

Commission is Rs 12000 and remaining profit is Rs 208000. Two fifths of it is Rs 83200 and total is Rs 95200.

Reserve is created first: 25% of 280,000 = Rs 70,000. Remaining profit = 280,000 − 70,000 = Rs 210,000. B's commission = 10% of remaining = 10% × 210,000 = Rs 21,000. A common wrong choice is 28,000, which results from applying 10% to the total profit instead of the remaining profit. Exam tip: always follow the deed order — subtract reserves first, then compute commission on the balance.

The governing concept is past adjustment when profit has been distributed in an incorrect ratio. Under the wrong 2:1 ratio, A received two-thirds of Rs 1,50,000: Rs 1,50,000 × 2/3 = Rs 1,00,000. Under the correct 3:2 ratio, A should have received three-fifths: Rs 1,50,000 × 3/5 = Rs 90,000. Therefore A received Rs 1,00,000 − Rs 90,000 = Rs 10,000 in excess. A must return or adjust back Rs 10,000, so option A is correct. Option B reverses the direction of adjustment, option C ignores the difference, and option D has no support in the calculation.

Interest on partner loan is an expense before profit appropriation. So Rs 12000 is deducted from net profit giving Rs 168000.

Interest on capital is appropriation not expense. Remove the Profit and Loss Account error and debit it in appropriation account.

Cs normal share is Rs 25000 and deficiency is Rs 15000. After firm guarantee A and B share remaining Rs 210000 in ratio six to three.

Let commission be C. Since commission is on profit after charging itself, C = 15% × (230000 − C). So C = 0.15×230000 − 0.15C ⇒ 1.15C = 0.15×230000 ⇒ C = \(230000 \times \frac{15}{115}\) = Rs 30000. Close distractors like Rs 32200 arise from applying an incorrect percentage (for example using 14% or treating the base as 100 instead of 115), so they are wrong. Exam tip: for "commission after charging" problems use C = (rate/(100+rate)) × profit_before_commission to save time and avoid algebraic errors.

B is not charged with loss. A and C ratio is four to two or two to one so Cs share is Rs 30000.

Step 1: Calculate the reserve: Reserve = 10% of ₹270,000 = ₹27,000, i.e. \(270000\times10\%=27000\).
Remaining profit = ₹270,000 − ₹27,000 = ₹243,000.
A's commission = 8% of the remaining profit = \(243000\times8\%=19440\). Thus the commission is ₹19,440.
Closest distractor: option B (₹21,600) arises from incorrectly taking 8% of the total profit (\(270000\times8\%=21600\)), but the commission must be on profit after reserve.
Exam tip: apply percentages in the correct order — subtract reserves/appropriations first, then compute commission or profit shares on the remainder.

Subtract salary first: profit before salary is Rs 242,000 and salary is Rs 42,000, so remaining profit = \(242000-42000=200000\). B's commission = 12% of remaining profit = \(0.12\times200000=24000\). Therefore Rs 24,000 is correct. Closest distractor Rs 29,040 is 12% of the profit before salary (a common mistake). Exam tip: always deduct salaries or guaranteed payments before computing commission on remaining profit.

Debit items are Rs 160000 and remaining profit is Rs 200000. Bs four ninth share is about Rs 88889.

Cs normal share is Rs 40000 and deficiency is Rs 10000. A and B share remaining Rs 150000 and Bs five eighth share is Rs 93750.

Total salary is Rs 90000 and remaining profit is Rs 190000. Cs three ninth share is about Rs 63333 and with salary total is about Rs 83333.

Interest on drawings is credited in appropriation account. So available amount is Rs 120000 plus Rs 6000 equal to Rs 126000.

Total claim is Rs 140000 and interest on capital share is five fourteenths. Five fourteenths of Rs 126000 is Rs 45000.

Cs normal share is one tenth which is Rs 25000. Guarantee is Rs 35000 so deficiency is Rs 10000.

The total ratio is 7+2 = 9. B's share is 2/9. So B's burden = (2/9) × 10,000 = 20,000/9 ≈ Rs 2,222.22. Option B (≈ Rs 7,777.78) corresponds to A's 7/9 share; options C and D are incorrect due to wrong splitting or rounding. Exam tip: compute 10,000 ÷ 9 ≈ 1,111.11, then multiply by 2 to get B's share quickly in exam conditions.

The direct answer is option A, Rs 22,400. The words “after salary and before reserve” tell us the order of calculation. First subtract the salary from the profit: Rs 3,50,000 − Rs 70,000 = Rs 2,80,000. The reserve is considered later, so it does not reduce the amount on which commission is calculated. Commission is 8% of Rs 2,80,000: \(8/100 \times 2,80,000 = Rs 22,400\). Option A is correct because it is exactly this amount. Option B, Rs 28,000, is 8% of Rs 3,50,000, so it ignores the salary deduction. Option C, Rs 20,000, does not follow the stated percentage and base. Option D, Rs 33,600, is 12% of Rs 2,80,000, not 8%. Remember: follow the words in order—profit, subtract salary, then calculate commission; reserve comes after it.

Interest on partner loan is an expense of firm. It should be taken to Profit and Loss Account not appropriation account.

Wrongly B received Rs 50000. Correct share is salary Rs 20000 plus half of remaining profit Rs 40000 totaling Rs 60000.

Cs normal share was Rs 80000 because Rs 10000 deficiency was added separately. If four tenth share is Rs 80000 total profit is Rs 200000.

Profit is shared in the ratio of claims. B has 3 parts and total = 2+3 = 5 parts, so B receives 75,000 × (3/5) = Rs 45,000. Option B (Rs 50,000) is incorrect — it would arise from using an incorrect fraction (for example treating B’s share as 2/3 or using the wrong total). Exam tip: always find total parts first, then multiply profit by (individual parts ÷ total parts).

A gets twenty percent which is Rs 50000. From remaining Rs 200000 Cs two fifth share is Rs 80000.

Bs normal share is Rs 60000 so deficiency is Rs 10000. Cs normal share was Rs 60000 and after bearing deficiency it becomes Rs 50000.