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Required: 1. Explain the relevance of the Partnership Act and the Partnership Deed 2. Prepare the following a. Statement of Profit and Loss and Appropriation Account b. The Partners Current Account c. The Statement of Financial Position

Required: 1. Explain the relevance of the Partnership Act and the Partnership Deed 2. Prepare the following a. Statement of Profit and Loss and Appropriation Account b. The Partners Current Account c. The Statement of Financial Position

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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Question Two Ali and Ranjeet are partners in the Punjabi Deli. The firm has provided the following data as at December 31, 2018 DETAILS Bank Cash Land and Building Provision for Depreciation on Building Machinery and Equipment Provision for Depreciation on Machinery & Equipment Capital Ali Capital Ranjeet Current Account Ali Current Accounts Ranjeet Drawings Ali Drawings Ranjeet Sales Wages and Salaries Telephone Discount Received Loan Interest Creditors Return Inwards Rent Received Purchases Debtors Provision for Bad Debts 10% Loan Commission Received Opening Stock Insurance Office Expenses Additional details available a Stock at the end of the year was values at 95,000 b. Wages is prepaid by $12,000 c. Insurance is owing by $7,000 d. Rent Received is owing by 8,000 Page 4 of 12 Land and building Machinery and equipment DR 89,950 40.300 550.000 132,000 10,000 80,000 30,000 20,000 60,000 8,000 12,000 13,000 352,250 64,000 e. Commission is prepaid by 10,000 f The provision for bad debts is to be revised to 10% of debtors g. Provide for depreciation as follows CR 5% Straight Line 5% Reducing Balance. 45,000 13,200 300,000 100.000 640.000 12.000 60,000 24,000 34,600 27,000 25,000 1,548,100 1,548,100 3.900 300.000 50,000 Details from the partnership agreement included the following: Interest is to be charged on drawing at 10% p.a. Interest is to be paid on capital at 10% p.a. Ali is to be paid a salary of $57210 p.a. The partners will share profit and loss in the same ratio as their capital Required: 1. Explain the relevance of the Partnership Act and the Partnership Deed 2. Prepare the following a. Statement of Profit and Loss and Appropriation Account b. The Partners Current Account c. The Statement of Financial Position.
Transcribed Image Text:Question Two Ali and Ranjeet are partners in the Punjabi Deli. The firm has provided the following data as at December 31, 2018 DETAILS Bank Cash Land and Building Provision for Depreciation on Building Machinery and Equipment Provision for Depreciation on Machinery & Equipment Capital Ali Capital Ranjeet Current Account Ali Current Accounts Ranjeet Drawings Ali Drawings Ranjeet Sales Wages and Salaries Telephone Discount Received Loan Interest Creditors Return Inwards Rent Received Purchases Debtors Provision for Bad Debts 10% Loan Commission Received Opening Stock Insurance Office Expenses Additional details available a Stock at the end of the year was values at 95,000 b. Wages is prepaid by $12,000 c. Insurance is owing by $7,000 d. Rent Received is owing by 8,000 Page 4 of 12 Land and building Machinery and equipment DR 89,950 40.300 550.000 132,000 10,000 80,000 30,000 20,000 60,000 8,000 12,000 13,000 352,250 64,000 e. Commission is prepaid by 10,000 f The provision for bad debts is to be revised to 10% of debtors g. Provide for depreciation as follows CR 5% Straight Line 5% Reducing Balance. 45,000 13,200 300,000 100.000 640.000 12.000 60,000 24,000 34,600 27,000 25,000 1,548,100 1,548,100 3.900 300.000 50,000 Details from the partnership agreement included the following: Interest is to be charged on drawing at 10% p.a. Interest is to be paid on capital at 10% p.a. Ali is to be paid a salary of $57210 p.a. The partners will share profit and loss in the same ratio as their capital Required: 1. Explain the relevance of the Partnership Act and the Partnership Deed 2. Prepare the following a. Statement of Profit and Loss and Appropriation Account b. The Partners Current Account c. The Statement of Financial Position.
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