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nent statement of XYZ CC X Y

nent statement of XYZ CC X Y

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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(c) Explain why the closing balance for each member on the net investment statement will not agree with the total of the balances of their ledger accounts which you have determined in exercise 1.2 above. Question 2 The balances on the net investment statement of XYZ CC at 31 December 2006 were as follows: Y Total R R R R 100% 375 000 30% 40% 30% 112 500 150 000 112 500 The members' contribution were as follows: R100 000 Y 100 000 100 000 R300 000 The balance of R75 000 arose from a revaluation of land and buildings two years earlier. It was agreed that X should retire and should sell his interest to Y and Z for R120 000 – each to pay R60 000. At the same time, M is to join the corporation. M is prepared to contribute R10 000 in cash and provide a loan of R50 000. What percentage interest should Y and Z offer to M, which would be fair to themselves? Financial Accounting II / © ICG / Page 40 Question 3 Mpumalanga Engineers (Pty) Ltd. is a company that was registered in 1997. Its financial year runs from 1 January to 31 December. Its balance sheet was drawn on 31 December 2007 and is shown below. MPUMALANGA ENGINEERS (PTY) LTD. Balance sheet at 31 December 2007 R R R FUNDS EMPLOYED Share capital 90 000 Ordinary shares of R1 each Undistributed profits Shareholders' equity 90 000 30 500 120 500 EMPLOYMENT OF FUNDS Fixed assets Land and buildings at cost Plant at cost Less: Depreciation Motor vehicle at cost 57 200 110 000 57 200 52 800 15 000
Transcribed Image Text:(c) Explain why the closing balance for each member on the net investment statement will not agree with the total of the balances of their ledger accounts which you have determined in exercise 1.2 above. Question 2 The balances on the net investment statement of XYZ CC at 31 December 2006 were as follows: Y Total R R R R 100% 375 000 30% 40% 30% 112 500 150 000 112 500 The members' contribution were as follows: R100 000 Y 100 000 100 000 R300 000 The balance of R75 000 arose from a revaluation of land and buildings two years earlier. It was agreed that X should retire and should sell his interest to Y and Z for R120 000 – each to pay R60 000. At the same time, M is to join the corporation. M is prepared to contribute R10 000 in cash and provide a loan of R50 000. What percentage interest should Y and Z offer to M, which would be fair to themselves? Financial Accounting II / © ICG / Page 40 Question 3 Mpumalanga Engineers (Pty) Ltd. is a company that was registered in 1997. Its financial year runs from 1 January to 31 December. Its balance sheet was drawn on 31 December 2007 and is shown below. MPUMALANGA ENGINEERS (PTY) LTD. Balance sheet at 31 December 2007 R R R FUNDS EMPLOYED Share capital 90 000 Ordinary shares of R1 each Undistributed profits Shareholders' equity 90 000 30 500 120 500 EMPLOYMENT OF FUNDS Fixed assets Land and buildings at cost Plant at cost Less: Depreciation Motor vehicle at cost 57 200 110 000 57 200 52 800 15 000
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