Use the information provided below to prepare the Statement of Changes in Equity for the year ended 28 February 2023. INFORMATION The information given below was extracted from the accounting records of Kelso Traders, a partnership business with Kelly and Solly as partners. Balances in the ledger as at 28 February 2023 Capital: Kelly 1 000 000 (Credit) Capital: Solly 600 000 (Credit) Current a/c: Kelly (01 March 2022) 100 000 (Credit) Current a/c: Solly (01 March 2022) 40 000 (Debit) Drawings: Kelly 800 000 (Debit) Drawings: Solly 600 000 (Debit) The following must be consider ed: (a) The net profit according to the Statement of Comprehensive Income amounted to R1 600 000 on 28 February 2023 (the end of the financial year). The sales for the year ended 28 February 2023 amounted to R 4 000 000. (b) The partnership agreement makes provision for the following: Interest on capital must be provided at 15% per annum on the balances in the capital accounts. Note: The partners increased their capital contributions by R 200 000 each on 28 February 2023. The capital changes have been recorded. The partners are entitled to the following monthly salaries: Kelly R20 000 Solly R15 000 Kelly is entitled to a special bonus equal to 5% of the amount by which the annual sales exceed R3 000 000. Kelly and Solly share the remaining profits or losses in the ratio 3:2 respectively.
Use the information provided below to prepare the Statement of Changes in Equity for the year ended 28 February 2023. INFORMATION The information given below was extracted from the accounting records of Kelso Traders, a partnership business with Kelly and Solly as partners. Balances in the ledger as at 28 February 2023 Capital: Kelly 1 000 000 (Credit) Capital: Solly 600 000 (Credit) Current a/c: Kelly (01 March 2022) 100 000 (Credit) Current a/c: Solly (01 March 2022) 40 000 (Debit) Drawings: Kelly 800 000 (Debit) Drawings: Solly 600 000 (Debit) The following must be consider ed: (a) The net profit according to the Statement of Comprehensive Income amounted to R1 600 000 on 28 February 2023 (the end of the financial year). The sales for the year ended 28 February 2023 amounted to R 4 000 000. (b) The partnership agreement makes provision for the following: Interest on capital must be provided at 15% per annum on the balances in the capital accounts. Note: The partners increased their capital contributions by R 200 000 each on 28 February 2023. The capital changes have been recorded. The partners are entitled to the following monthly salaries: Kelly R20 000 Solly R15 000 Kelly is entitled to a special bonus equal to 5% of the amount by which the annual sales exceed R3 000 000. Kelly and Solly share the remaining profits or losses in the ratio 3:2 respectively.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Use the information provided below to prepare the Statement of Changes in Equity for the year ended 28 February
2023. INFORMATION The information given below was extracted from the accounting records of Kelso Traders, a
partnership business with Kelly and Solly as partners. Balances in the ledger as at 28 February 2023 Capital: Kelly
1 000 000 (Credit) Capital: Solly 600 000 (Credit) Current a/c: Kelly (01 March 2022) 100 000 (Credit) Current a/c: Solly
(01 March 2022) 40 000 (Debit) Drawings: Kelly 800 000 (Debit) Drawings: Solly 600 000 (Debit) The following must be
consider ed: (a) The net profit according to the Statement of Comprehensive Income amounted to R1 600 000 on 28
February 2023 (the end of the financial year). The sales for the year ended 28 February 2023 amounted to R
4 000 000. (b) The partnership agreement makes provision for the following: Interest on capital must be provided at
15% per annum on the balances in the capital accounts. Note: The partners increased their capital contributions by R
200 000 each on 28 February 2023. The capital changes have been recorded. The partners are entitled to the
following monthly salaries: Kelly R20 000 Solly R15 000 Kelly is entitled to a special bonus equal to 5% of the amount
by which the annual sales exceed R3 000 000. Kelly and Solly share the remaining profits or losses in the ratio 3:2
respectively.
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