Kamal and Kapil are partners having fixed capitals of ₹ 5,00,000 each as on 1st April 2023. Kamal introduced further capital of ₹ 1,00,000 on 1st January 2024 whereas Kapil withdrew ₹ 1,00,000 on 1st January 2024 out of capital.
Interest on capital is to be allowed @ 10% p.a.
The firm earned a net profit of ₹ 6,00,000 for the year ended 31st March 2024.
Pass the Journal entry for interest on capital and prepare Profit and Loss Appropriation Account.
Solution:
