| X, Y and Z running business in partnership since last 8 years. They are sharing profits in the ratio of 2:1:1. It was observed in the current year that there was problem in their accounts. It was discovered that the interest on capital and interest on drawings had been omitted. |
| On 31st March 2021, the balances in their capital accounts after making adjustments for profits and drawings were |
| Rs.1,60,000; Rs.1,20,000 and Rs.80,000 respectively. The profit for the year ended 31st March 2021 was Rs.40,000. |
| During the year X and Y each withdrew a total sum of Rs.24,000 in equal instalments in the beginning of each month and Z withdrew a total sum of Rs.48,000 in equal instalments at the end of each month.. |
| The interest on drawings was to be charged @5% p.a. and interest on capital was to be allowed @ 10% p.a. |
| Opening Capital of Z was: |
A) 1,64,000
B) 1,34,000
C) 1,18,000
D) 1,20,000
Correct Answer: C
Solution :
1,18,000
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