Question 1

Wee and Zed are partners, with fixed capitals of Wee RM18,000 and Zed RM28,000. Their partnership agreement contains the following provisions : 1. Profits and losses are shared 3/5 Wee, 2/5 Zed. 2. Zed receives a salary of RM20,920 per annum. 3. Wee receives 15% commission on all cash sales. 4. Interest on fixed capitals is paid at the rate 1% per annum. 5. Interest on partners loans is paid at the rate of 10% per annum. 6. Interest on drawings is charged at 4% on partners individual total drawings for any year. Balances in the partners books at the end of the partners financial year, 31 March Year 4, included : RM 23,100 152,800 38,200 89,700 10,890 48,300 91,400 58,960 130,000 10,000 8,230 290 85,690 62,300 8,840

Freehold land and building at cost Motor vehicles at cost, 1 April Year 3 Motor vehicle depreciation provision, 1 April Year 3 Stocks at 1 April Year 3 Trade debtors Credit sales Cash sales Bank overdraft Bank loan, repayable Year 10 Short-term loan from Zed, made on 1 October Year 3 Trade creditors Provision for Doubtful Debts, 1 April Year 3 Purchases, net of drawings Wages Miscellaneous expenses

Additional information at 31 Mach Year 4 : (a) Current Account balances of the partners at 1 April Year 3 were : Wee RM2,340 Dr; Zed RM9,420 Cr. (b) Motor vehicle depreciation is to be provided at 25% per annum on the straight-line basis. A full years depreciation is charged in the year of purchase.

(c) On 1 May Year 3, Wee supplied a motor lorry valued at RM8,400 to be business. The amount was credited to his Current Account. On 1 July Year 3, the vehicle was damaged beyond repair in a road accident. The insurance company is willing to pay RM7,100 in settlement of the claim. The partners have agreed to accept this amount, but it has not yet been received. (d) Bad debts of RM690 should be written off trade debtors. The Provision for Doubtful Debts is to be adjusted to 5% of the remaining net debtors. (e) Interest accrued on bank loan was RM4,800. (f) Drawings for the year to 31 March Year 4 were : Goods RM Wee 600 Zed 1,890

Cash RM 2,400 250

(g) Zed has also had work done on his home by employees at a wages cost of RM4,360. He supplied the materials himself. No entry has been made for this in the books. (h) Stocks at 31 March Year 4 were valued at cost at RM113,870 REQUIRED : Prepare, for Wee and Zed, the Trading, Profit & Loss and Appropriation Account for the year ended 31 March Year 4. (25 marks)

Question 2 The following is the Trial Balance of the partnership of Moore and Wright at 31 March Yar 7 : RM Capital - Moore - Wright Current Accounts : Moore Wright Fixtures and fittings at cost Provision for depreciation of Fixtures and Fittings at 1 April Year 6 Stock, at 1 April Year 6 Sales Purchases Rent Rates Debtors and creditors Insurance Heating & lighting Carriage inwards Discounts allowed General expenses Drawings - Moore - Wright Bank Wages RM 60,000 15,000

2,300 1,600 24,000 6,000 41,600 187,400 104,300 4,800 3,900 31,400 1,500 2,900 1,700 1,400 3,600 12,000 6,000 17,400 33,200 293,600

25,200

293,600

Additional information : (1) Stock at 31 March Year 7 was valued at cost RM46,000. (2) Depreciation of RM2,000 is to be written off Fixtures & Fittings. (3) During the year, Wright took goods which cost RM200 for his own use but no entry has been made in the books. (4) Wages accrued, at 31 March Year 7, amounted to RM1,100 and Rates of RM700 had been prepaid. (5) The partnership agreement provided that : i. Interest at the rate of 8% per annum is to be allowed on the partners Capital Account balances. ii. Wright is to be credited with a salary of RM5,000 per annum. iii. Profits and losses are to be shared in the same ratio as capital.

REQUIRED : i. Prepare the Trading, Profit & Loss and Appropriation Account for the partnership for the year ended 31 March Year 7. (12 marks) Write up the partners Current Accounts for the year ended 31 March Year 7, in columnar form. (7 marks) Prepare the Balance Sheet of the partnership at 31 March Year 7. (6 marks) (Total 25 marks)

ii.

iii.

Question 3 Jane Smith and Rosalind Hughes are in partnership, sharing profits and losses in the ratio 3:2 respectively. The following Trial Balance has been extracted from the books of the partnership at 30 November Year 4: Dr. $ 24,300 58,000 820 24,100 6,030 8,000 4,000 40,000 20,000 10,100 4,200 20,000 18,000 2,850 71,200 800 162,100 Cr. $ 11,800

Debtors Creditors Premises at cost Cash in bank Office expenses Rates Furniture at cost Accumulated depreciation on furniture, 1 December Year 3 Partners Capital Accounts - Jane Smith - Rosalind Hughes Partners Current Accounts - Jane Smith - Rosalind Hughes Drawings - Jane Smith - Rosalind Hughes Stock at cost, 30 November Year 4 Gross profit for the year to 30 November Year 4 Provison for Doubtful Debts

162,100 The following additional information is available : (1) Debts of $1,300 are to be written off.

(2) The Provision for the Doubtful Debts is to be adjusted to 5% of debtors remaining at 30 November Year 4. (3) Depreciation is to be provided on furniture at 10% on cost. (4) Rosalind Hughes is to be credited with a salary of $12,000 at 30 November Year 4. (5) Interest at 5% per annum is to be allowed on the partners fixed capitals.

REQUIRED : Prepare for Jane Smith and Rosalind Hughed : i. The Profit and Loss and Appropriation Account for the year to 30 November Year. (10 marks) ii. The Current Accounts for the year to 30 November Year 4, in columnar form. (6 marks) iii. The Balance Sheet at 30 November Year 4, in vertical form. (9 marks) (Total 25 marks)

Question 4 Ash and Beach are in partnership sharing profits and losses equally. A Trading Account for the year ended 31 December Year 10 was prepared, after which the following Trial Balance was produced : Trial Balance at 31 December Year 10 $ Capital Accounts (1 January Year 10) - Ash - Beech Current Accounts (1 January Year 10) - Ash - Beech Drawings - Ash - Beech Freehold premises Motor vehicles at cost Provision for Depreciation of Motor Vehicles (1 January Year 10) Light and heat Rates Fixtures and fittings Provision for Depreciation of Fixtures and Fittings (1 January Year 10) Bad debts Wages and salaries Motor vehicle expenses Postage and telephone Debtors and creditors Provision for Doubtful Debts Repairs to buildings Insurance Printing and stationery Discounts allowed and received Bank Cash Gross Profit Stock (31 Disember Year 10) $ 300,000 200,000

1,040 2,900

30,000 34,000 423,000 64,000 28,000 1,350 2,000 60,000 36,000 550 160,000 4,200 2,100 12,000 3,200 900 1,410 600 14,351 64 14,200 828,965

9,540 600

801

251,124 828,965

The following additional information is available at 31 Disember Year 10 : (1) Rates prepaid $300. (2) Light and heat accrued due &170. (3) Depreciation to be provided : Motor vehicles 20% per annum on cost. Fixtures and fittings 10% per annum on cost. (4) Provision for Doubtful Debts to be 4% of debtors. (5) The partnership agreement provided as follows : Interest on capital at 5% per annum. Interest at 5% per annum allowed or charged on Partners Current Account balance at 1 January Year 10. Interest charged at 5% on drawing was calculated and agreed as follows : Ash Beech $1,200 $1,500

Partners salaries per annum : Ash Beech REQUIRED : For the partnership of Ash and Beech, prepare : i. ii. iii. The Profit and Loss and Appropriation Account for the year ended 31 December Year 10. Partners Current Account in columnar form. The Balance Sheet as 31 December Year 10. $17,500 $25,250