INTRODUCTION OF

PARTNERSHIP ACCOUNTS

साझेदारी का सामान्य परिचय

CLASS-12th

ASSISTANT PROFESSOR
DEEPIKA JAIN
 PROFIT
AND LOSS
APPROPRIA
TION
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DISTRIBUTION OF PROFIT AMONG

PARTNER
लाभ ओर हानि का विभाजन

• The profits and losses of the firm are

distributed among the partners in an
agreed ratio. However, if the
partnership deed is silent the firm's
profits and losses are to be shared
equally by all the partners.

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PROFIT AND LOSS APPROPRIATION

ACCOUNT
• Profit and Loss Appropriation Account is merely an
extension of the Profit and Loss Account of the firm. It
shows how the profits are appropriated or distributed among
the partners. All adjustments in respect of partner's salary,
partner's commission, interest on capital, interest on
drawings, etc. are made through this account.

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JOURNAL ENTRIES

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JOURNAL ENTRIES

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JOURNAL ENTRIES

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JOURNAL ENTRIES

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JOURNAL ENTRIES

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EXAMPLE
• Amit. Babu and Charu set up a partnership firm on April 1, 2006. They contributed Rs. 50,000, Rs. 40,000 and Rs. 30,000, respectively as their capitals and agreed to share profits
and losses in the ratio of3 : 2:1. Amit is to be paid a salary of Rs. 1 ,000 per month and Babu, a Commission ofRs. 5, 000. It is also provided that interest to be allowed on capital at
6% p.a. The drawings for the year were Amit Rs. 6,000, Babu Rs. 4,000 and Charu Rs. 2,000. Interest on drawings of Rs. 270 was charged on Amit's drawings, Rs. 180 on Babu's
drawings and Rs. 90, on Charu's drawings. The net profit as per Profit and Loss Account for the year ending March 31, 2006 was Rs. 35,660. Prepare the Profit and Loss
Appropriation Account to show the distribution of profit among the partners.

PARTICULAR AMOUNT PARTICULAR AMOUNT

SALARY NET PROFIT
BABU’S COMMISSION INTEREST ON DRAWING
AMIT
BABU
CHARU
INTEREST ON CAPITALS
AMIT
BABU
CHARU
SHARE OF PROFIT
TRANSFERRED TO CAPITAL
ACCOUNT
AMIT
BABU
CHARU
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