BACHELOR OF COMMERCE YEAR 1- ACADEMIC AND ASSESSMENT CALENDAR - DISTANCE The following must still be taken into account: 1. The partnership agreement makes provision for the following: Interest on capital must be provided at 12% per year on the balances in the capital accounts for the period 1 March 2020 to 31 August 2020. The interest rate increases to 15% per year for the remainder of the year ie 1 September 2020 to 28 February 2021. The capital accounts remained unchanged. Interest on current accounts must be provided at 12% per year on the opening balances of the current accounts. The partners are entitled to the following monthly salaries: Andile R18 000 per month for a full year. Sipho R20 000 per year for the full year. Andile and Sipho withdrew 50% of their monthly salaries in cash as drawings. These amounts are not included in the drawings account shown above. Sipho is entitled to a special bonus equal to 2,5% of the net profit for the year. Andile and Sipho share profits and losses in the ratio of 3:2 respectively. Required: Use the information provided above to prepare the statement of changes in equity (current accounts only) for the year ended 28 February 2021. Use the following format: Capital accounts section is NOT required.
BACHELOR OF COMMERCE YEAR 1- ACADEMIC AND ASSESSMENT CALENDAR - DISTANCE The following must still be taken into account: 1. The partnership agreement makes provision for the following: Interest on capital must be provided at 12% per year on the balances in the capital accounts for the period 1 March 2020 to 31 August 2020. The interest rate increases to 15% per year for the remainder of the year ie 1 September 2020 to 28 February 2021. The capital accounts remained unchanged. Interest on current accounts must be provided at 12% per year on the opening balances of the current accounts. The partners are entitled to the following monthly salaries: Andile R18 000 per month for a full year. Sipho R20 000 per year for the full year. Andile and Sipho withdrew 50% of their monthly salaries in cash as drawings. These amounts are not included in the drawings account shown above. Sipho is entitled to a special bonus equal to 2,5% of the net profit for the year. Andile and Sipho share profits and losses in the ratio of 3:2 respectively. Required: Use the information provided above to prepare the statement of changes in equity (current accounts only) for the year ended 28 February 2021. Use the following format: Capital accounts section is NOT required.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:BACHELOR OF COMMERCE YEAR 1 – ACADEMIC AND ASSESSMENT CALENDAR - DISTANCE
The following must still be taken into account:
1. The partnership agreement makes provision for the following:
Interest on capital must be provided at 12% per year on the balances in the
capital accounts for the period 1 March 2020 to 31 August 2020. The interest rate
increases to 15% per year for the remainder of the year ie 1 September 2020 to
28 February 2021. The capital accounts remained unchanged.
Interest on current accounts must be provided at 12% per year on the opening
balances of the current accounts.
The partners are entitled to the following monthly salaries:
Andile R18 000 per month for a full year.
Sipho R20 000 per year for the full year.
Andile and Sipho withdrew 50% of their monthly salaries in cash as drawings.
These amounts are not included in the drawings account shown above.
Sipho is entitled to a special bonus equal to 2,5% of the net profit for the year.
Andile and Sipho share profits and losses in the ratio of 3:2 respectively.
Required:
Use the information provided above to prepare the statement of changes in equity
(current accounts only) for the year ended 28 February 2021.
Use the following format: Capital accounts section is NOT required.
REGENT BUSINESS SCHOOL (RBS) – JANUARY 2021
38
![QUESTION THREE
[20]
Adax Designs Services is a partnership with Adam and Max as partners. The
partnership has been operating successfully for a number of years now. The partners
have a written partnership agreement. The following information was extracted from the
accounting records of Adax. Design Services for the financial year ended 28 February
2021:
Balances in the ledger as at 28 February 2021
R
Land and buildings at cost
835 000
Accumulated depreciation: buildings
(65 000)
Equipment at carrying amount
270 000
Debtors
103 000
Capital- Andile
400 000
Capital- Sipho
300 000
Current account- Andile Credit balance (1 March 2020)
40 000
Current account -Sipho – Debit balance (1 March 2020
20 000
Drawings – Andile: General
130 000
Drawings – Sipho: General
102 000
Net profit for the year ended 28 February 2021
800 000
REGENT BUSINESS SCHOOL (RBS) – JANUARY 2021
37](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fbb8057d3-8aa5-4044-b87c-e4a815da7797%2Fbb4f154c-5644-4f14-9605-e17bb0212c62%2Fn0xj0wa_processed.jpeg&w=3840&q=75)
Transcribed Image Text:QUESTION THREE
[20]
Adax Designs Services is a partnership with Adam and Max as partners. The
partnership has been operating successfully for a number of years now. The partners
have a written partnership agreement. The following information was extracted from the
accounting records of Adax. Design Services for the financial year ended 28 February
2021:
Balances in the ledger as at 28 February 2021
R
Land and buildings at cost
835 000
Accumulated depreciation: buildings
(65 000)
Equipment at carrying amount
270 000
Debtors
103 000
Capital- Andile
400 000
Capital- Sipho
300 000
Current account- Andile Credit balance (1 March 2020)
40 000
Current account -Sipho – Debit balance (1 March 2020
20 000
Drawings – Andile: General
130 000
Drawings – Sipho: General
102 000
Net profit for the year ended 28 February 2021
800 000
REGENT BUSINESS SCHOOL (RBS) – JANUARY 2021
37
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