IGCSE Accounting Paper-2: Specimen Questions with Answers 188 - 188 of 189
Passage
Harry and Hermione are in partnership. Their partnership agreement provides that:
1. Partners are entitled to interest on their fixed capitals at 12% per annum.
2. Partners loans carry interest at 10% per annum.
3. Hermoine is to receive a salary of $ 6000 a year.
4. Profits and losses are to be shared in the ratio of 5: 3.
For the financial year ended 31 March 2020, balances in the partnership՚s books included the following-
Dr. $ | Cr. $ | |
Capital A/cs on 1st April 2019 Harry | 35000 | |
Hermione | 25000 | |
Fixed Assets at Cost | 60000 | |
Gross Profit for the year | 32000 | |
Office Expenses | 1200 | |
Salaries | 3000 | |
Discount Allowed & Received | 600 | 800 |
Commission Paid | 300 |
The following additional information is also given.
(1) At 31 March 2020:
Advance Salary paid was $ 1000,
Office expenses accrued were $ 600.
(2) Depreciation on fixed assets is to be provided at 10% on cost. Fixed Assets were purchased on 1st July 2019.
(3) On 1st October 2019 Harry made a loan of $ 8000 to the partnership. No loan interest was paid to Harry in the year ended 31 March 2020.
Question 188 (1 of 2 Based on Passage)
Write in Short Short Answer▾
Prepare (Marks 10)
(I) the partnership՚s Profit and Loss Account and
(II) the partnership՚s Appropriation Account for the year ended 31 March 2020
(I) Harry and Hermione Profit and Loss Account for the year ended 31 March 2020
EditExplanation
Harry and Hermione
Profit & Loss a/C for the Year Ended 31 March 2020
$ | $ | ||
Depreciation | 4500 | Gross Profit b/d | 32000 |
Office Expenses $ 1200 Add: Office Exp. Accrued $ 600 | 1800 | Discount Received | 800 |
Salaries $ 3000 Less: Advance Salary paid $ 1000 | 2000 | ||
Discount Allowed | 600 | ||
Commission | 300 | ||
Interest on Harry՚s Loan | 400 | ||
Net Profit | 23200 | ||
32800 | 32800 |
Depreciation on Fixed Assets =
Interest on Harry՚s Loan =
(II) Appropriation Account for the year ended 31 March 2020
Ans (II) Harry and Hermione
Profit & Loss Appropriation a/C for the Year Ended 31 March 2020
$ | $ | ||
Interest on Capital: Harry- $ 4200 Hermione- $ 3000 | 7200 | Net Profit b/d | 23200 |
Hermione՚s Salary | 6000 | ||
Share in Profits: | |||
Harry- $ 6250 | |||
Hermione- $ 3750 | 10000 | ||
23200 | 23200 |
Interest on Capital:
Harry-
Hermione-
Share in Profits
Harry-
Hermione-