case.
here is a loss of 900 which
26. (Interest on Capital/Drawings and Profits given) From the following Balance Sheet of
Rich and Poor, calculate interest on capital @ 10% p.a. for the year ended 31-3-2017.
BALANCE SHEET
₹
Assets
(
42,000
2,000
Liabilities
Rich’s Capital –
Poor’s Capital
Profit & Loss Appropriation A/C
(2016-2017)
20,000 Sundry Assets
16,000 Drawings (Rich)
8,000
RIS,
p> (30)
44,000
44,000
During the year ended 31-3-17 Rich’s drawings were 3,000 and Poor’s Drawings were
5,000. Profits during the year were 12,000.
[Ans. Rich 1,900 ; Poor 1,900]
tol)
Answer:
no interest on capital
Explanation:
because when firm are not earned profit then not charge interest on capital.