1. Financial accounting (AS Level)
A section of Accounting, 9706
Listing 10 of 1775 questions
Darius and Ewan are in partnership sharing profits and losses in the ratio 5 : 3. The following balances were extracted from the partnership books of account at 31 July 2022. $ Bank overdraft 12 700 Capital accounts Darius 94 300 Ewan 68 300 Fixtures and fittings 44 000 Inventory 36 200 Property at valuation 127 000 Bank loan (2025) 24 000 Trade payables 14 200 Trade receivables 6 300 On 1 August 2022, the partners agreed to admit Karim into the partnership on the following terms. Karim was to introduce total capital of $48 000. This consisted of fixtures and fittings valued at $9500 with the balance to be introduced into the partnership bank account. Future profits and losses were to be shared between Darius, Ewan and Karim in the ratio 5 : 3 : 2. Goodwill was to be valued at $36 800. Goodwill was not to be retained in the books of account. Property was to be revalued to $135 000. Obsolete inventory of $2000 was to be written off. REQUIRED Prepare, on page 9, the partners’ capital accounts on 1 August 2022 following the admission of Karim. Prepare the partnership statement of financial position at 1 August 2022 following the admission of Karim. Use the space provided on page 11 for your workings. Darius, Ewan and Karim Statement of financial position at 1 August 2022 Workings: Additional information Partners may allow interest on capital and charge interest on drawings. REQUIRED State one advantage of allowing interest on capital to a: partner partnership Explain one reason why a partnership may charge interest on drawings.
9706_w22_qp_23
THEORY
2022
Paper 2, Variant 3
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Questions Discovered
1775