Comprehension Passage
Mannu and Shrishti are partners in a firm sharing profit in the ratio of 3:2.
Following is the balance sheet of the firm as on March 31, 2017:
Balance Sheet as at March 31, 2017
Additional Information:
Profit for the year ended March 31, 2017 was Rs. 5,000 which was divided in the agreed ratio, but interest @ 5% p.a. on capital and @ 6% p.a. on drawings was omitted. Adjust interest on drawings on an average basis for 6 months.
Balance Sheet as at March 31, 2017
| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
|---|---|---|---|
| Mannu’s Capital | 30,000 | Drawings: Mannu | 4,000 |
| Shrishti’s Capital | 10,000 | Drawings: Shrishti | 2,000 |
| 40,000 | Other Assets | 34,000 | |
| Total | 40,000 |
Profit for the year ended March 31, 2017 was Rs. 5,000 which was divided in the agreed ratio, but interest @ 5% p.a. on capital and @ 6% p.a. on drawings was omitted. Adjust interest on drawings on an average basis for 6 months.
What is the total impact (net effect) of omitted interest adjustments on Mannu’s account?
1
Rs. 1,620 to be credited
2
Rs. 1,500 to be credited
3
Rs. 120 to be debited
4
Rs. 1,380 to be credited