when any person can start the business then amount is contributed by the partner in partnership firm then interest is contributed in profit sharing ratio. how profit sharing ratio is calculated? supposed A contribute 2000000, B 2000000, and C 1000000. then profit sharing ratio is:
ratio = 2:2:1 and company earn profit in a year 100,00,00
- 1000000*2/5 = 400000
- 1000000*2/5 = 400000
- 1000000*1/5 = 200000
- TOTAL 1000000
How to activate the interest on capital?
- F11 --> F1 --> activate interest calculation
(Use advanced parameters)
Go to group:
- account info. --> Group
- Group --> create (interest to partner) under primary category.
Then go to create ledger:
- Account info. --> Ledger
- Ledger--> create
In ledger any two or more name are created:
e.g. Mr. Mahesh Kumar, Mr. Ramesh Kumar. It is only which are shown in profit and loss account. It is under the interest to partner account.
In ledger any two or more name partner are created :
e.g. Mr. Mahesh Kumar partner, Mr. Ramesh Kumar partner. It is only which are shown in balance sheet. It is under the capital account. And in this point activate the interest on capital.
How to see all the entry?
- Display --> account books
- account books --> ledger
- ledger--> press enter to see all the entry
Go to accounting voucher:
In journal: for contribution the amount from the entire par
Cash –a/c Dr.
To Mahesh Kumar partner a/c Cash –a/c Dr.
To Ramesh Kumar partner
To Ramesh Kumar partner
Cash withdrawn: journal
Mr. Mahesh/ OR Ramesh Kumar partner a/c Dr.
To cash a/c
After withdrawn the amount then calculate the interest.
How to see the interest calculation?
- Display --> statement of accounts
- statement of accounts -->interest calculation
- interest calculation--> ledger
In balance sheet and profit and loss can also see the interest amount
After calculate the interest make entry in journal voucher at the end of year:
Interest amount calculate on balance amount
(200000 – 50000) =150000*12%
Mahesh/Ramesh –a/c Dr.
To Mahesh/ Ramesh Kumar partner