REQUIRED Prepare the Statement of Changes in Equity for the year ended 29 February 2024. INFORMATION The information given below was extracted from the accounting records of Benson Traders, a partnership business with Bennie and Sonny as partners. Extract from the ledger of Benson Traders as at 29 February 2024 Capital: Bennie Capital: Sonny Current a/c: Bennie (01 March 2023) Current a/c: Sonny (01 March 2023) Drawings: Bennie Debit (R) Credit (R) 1 000 000 800 000 60 000 80 000 500 000 600 000 Drawings: Sonny The following must be considered: (1) The Statement of Comprehensive Income for the year ended 29 February 2024 reflected a net profit of R1 200 000. (2) The partnership agreement provided for interest on capitals at 15% p.a. on the balances in the capital accounts. However, the partners agreed to increase the interest rate to 18% p.a. with effect from 01 September 2023. Bennie also increased his capital contribution by R200 000 on the same date. The capital change has been recorded. (3) The partners are entitled to the following monthly salaries: Bennie R20 000 Sonny 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 their capital balances at the beginning of the financial year.
REQUIRED Prepare the Statement of Changes in Equity for the year ended 29 February 2024. INFORMATION The information given below was extracted from the accounting records of Benson Traders, a partnership business with Bennie and Sonny as partners. Extract from the ledger of Benson Traders as at 29 February 2024 Capital: Bennie Capital: Sonny Current a/c: Bennie (01 March 2023) Current a/c: Sonny (01 March 2023) Drawings: Bennie Debit (R) Credit (R) 1 000 000 800 000 60 000 80 000 500 000 600 000 Drawings: Sonny The following must be considered: (1) The Statement of Comprehensive Income for the year ended 29 February 2024 reflected a net profit of R1 200 000. (2) The partnership agreement provided for interest on capitals at 15% p.a. on the balances in the capital accounts. However, the partners agreed to increase the interest rate to 18% p.a. with effect from 01 September 2023. Bennie also increased his capital contribution by R200 000 on the same date. The capital change has been recorded. (3) The partners are entitled to the following monthly salaries: Bennie R20 000 Sonny 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 their capital balances at the beginning of the financial year.
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter15: Investments And Fair Value Accounting
Section: Chapter Questions
Problem 3PA: Forte Inc. produces and sells theater set designs and costumes. The company began operations on...
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Question
Q2. Prepare the Statement of Changes in Equity for the year ended 29 February 2024.
Transcribed Image Text:REQUIRED
Prepare the Statement of Changes in Equity for the year ended 29 February 2024.
INFORMATION
The information given below was extracted from the accounting records of Benson Traders, a
partnership business with Bennie and Sonny as partners.
Extract from the ledger of Benson Traders as at 29 February 2024
Capital: Bennie
Capital: Sonny
Current a/c: Bennie (01 March 2023)
Current a/c: Sonny (01 March 2023)
Drawings: Bennie
Debit (R)
Credit (R)
1 000 000
800 000
60 000
80 000
500 000
600 000
Drawings: Sonny
The following must be considered:
(1) The Statement of Comprehensive Income for the year ended 29 February 2024 reflected a net
profit of R1 200 000.
(2) The partnership agreement provided for interest on capitals at 15% p.a. on the balances in the
capital accounts. However, the partners agreed to increase the interest rate to 18% p.a. with
effect from 01 September 2023. Bennie also increased his capital contribution by R200 000 on
the same date. The capital change has been recorded.
(3) The partners are entitled to the following monthly salaries:
Bennie R20 000
Sonny 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 their
capital balances at the beginning of the financial year.
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