Prepare the Statement of Changes in Equity for the year ended 29 February 2024. INFORMATIONThe information given below was extracted from the accounting records of Benson Traders, apartnership business with Bennie and Sonny as partners.Extract from the ledger of Benson Traders as at 29 February 2024Debit (R) Credit (R)Capital: Bennie 1 000 000 Capital: Sonny 800 000Current a/c: Bennie (01 March 2023) 60 000Current a/c: Sonny (01 March 2023) 80 000 Drawings: Bennie 500 000Drawings: Sonny 600 000 The following must be considered: (1) The Statement of Comprehensive Income for the year ended 29 February 2024 reflected a netprofit of R1 200 000. (2) The partnership agreement provided for interest on capitals at 15% p.a. on the balances in thecapital accounts. However, the partners agreed to increase the interest rate to 18% p. a. witheffect from 01 September 2023. Bennie also increased his capital contribution by R200 000 onthe same date. The capital change has been recorded. (3) The partners are entitled to the following monthly salaries:Bennie R20 000Sonny R18.000(4) Sonny is entitled to a special bonus of 10% of the net profit (before any appropriations). (5) The balance of the profit or loss must be shared between Bennie and Sonny in the ratio of theircapital balances at the beginning of the financial year. Prepare the Statement of Changes in Equity for the year ended 29 February 2024. INFORMATIONThe information givenbelow was extracted from the accounting records of Benson Traders, apartnership business with Bennie and Sonny aspartners.Extract from the ledger of Benson Traders as at 29 February 2024Debit (R) Credit (R)Capital: Bennie 1 000 000Capital: Sonny 800 000 Current a/c: Bennie (01 March 2023) 60 000Current a/c: Sonny (01 March 2023) 80 000Drawings: Bennie 500 000Drawings: Sonny 600 000The following must be considered: (1) The Statement ofComprehensive Income for the year ended 29 February 2024 reflected a netprofit of R1 200 000. (2) The partnershipagreement provided for interest on capitals at 15% p.a. on the balances in thecapital accounts. However, the partnersagreed to increase the interest rate to 18% p. a. witheffect from 01 September 2023. Bennie also increased his capitalcontribution by R200 000 onthe same date. The capital change has been recorded.(3) The partners are entitled to thefollowing monthly salaries:Bennie R20 000Sonny R18 000(4) Sonny is entitled to a special bonus of 10% of the net profit(before any appropriations). (5) The balance of the profit or loss must be shared between Bennie and Sonny in the ratioof theircapital balances at the beginning of the financial year.

The Statement of Changes in Equity for Benson Traders encapsulates the alterations in the partners'…

Prepare the Statement of Changes in Equity for the year ended 29 February 2024. INFORMATIONThe information given below was extracted from the accounting records of Benson Traders, apartnership business with Bennie and Sonny as partners.Extract from the ledger of Benson Traders as at 29 February 2024Debit (R) Credit (R)Capital: Bennie 1 000 000 Capital: Sonny 800 000 Current a/c: Bennie (01 March 2023) 60 000Current a/c: Sonny (01 March 2023) 80 000 Drawings: Bennie 500 000Drawings: Sonny 600 000The following must be considered: (1) The Statement of Comprehensive Income for the year ended 29 February 2024 reflected a netprofit of R1 200 000. (2) The partnership agreement provided for interest on capitals at 15% p.a. on the balances in thecapital accounts. However, the partners agreed to increase the interest rate to 18% p. a. witheffect from 01 September 2023. Bennie also increased his capital contribution by R200 000 onthe same date. The capital change has been recorded.(3) The partners are entitled to the following monthly salaries:Bennie R20 000Sonny R18 000(4) Sonny is entitled to a special bonus of 10% of the net profit (before any appropriations). (5) The balance of the profit or loss must be shared between Bennie and Sonny in the ratio of theircapital balances at the beginning of the financial year.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Problem 1Q

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Prepare the Statement of Changes in Equity for the year ended 29 February 2024. INFORMATIONThe information given below was extracted from the accounting records of Benson Traders, apartnership business with Bennie and Sonny as partners.Extract from the ledger of Benson Traders as at 29 February 2024Debit (R) Credit (R)Capital: Bennie 1 000 000 Capital: Sonny 800 000Current a/c: Bennie (01 March 2023) 60 000Current a/c: Sonny (01 March 2023) 80 000 Drawings: Bennie 500 000Drawings: Sonny 600 000 The following must be considered: (1) The Statement of Comprehensive Income for the year ended 29 February 2024 reflected a netprofit of R1 200 000. (2) The partnership agreement provided for interest on capitals at 15% p.a. on the balances in thecapital accounts. However, the partners agreed to increase the interest rate to 18% p. a. witheffect from 01 September 2023. Bennie also increased his capital contribution by R200 000 onthe same date. The capital change has been recorded. (3) The partners are entitled to the following monthly salaries:Bennie R20 000Sonny R18.000(4) Sonny is entitled to a special bonus of 10% of the net profit (before any appropriations). (5) The balance of the profit or loss must be shared between Bennie and Sonny in the ratio of theircapital balances at the beginning of the financial year.

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

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