Mudit Sudhir and Uday are partners in a firm sharing profits in the ratio of 3 1 1 Their fixed capit......

Mudit, Sudhir and Uday are partners in a firm sharing profits in the ratio of 3 : 1 : 1. Their fixed capital balances are 4,00,000, 1,60,000 and 1,20,000 respectively. Net profit for the year ended 31st March, 2018 distributed amongst the partners was 1,00,000, without taking into account the following adjustments:

a Interest on capitals @ 2.5% p.a.;

b Salary to Mudit 18,000 p.a. and commission to Uday 12,000.

c Mudit was allowed a commission of 6% of divisible profit after charging such commission. Pass a rectifying Journal entry in the books of the firm. Show workings clearly.

By: Aman