Given:
Net profit b/d…………………N10,000
Interest on capital:…M………..N2, 000
…………………..K………..N1, 000
Partners’ on salary….K………..N800
Interest on drawings…M………..N500
Profit sharing ratio M and K 3:2
Determine M’s share of profit?
- 6,280
-
4,020
- 2,820
- 2,280
The correct answer is: B
Explanation
Profit and Loss Appropriation A/C
| partners salary - K 800 Int.on capital - M 2000 K 1000 share of profit - M 4020 K 2680 6700 10500 |
Net profit b/d 10000 Int. on drawings: M 500 10500 |