Mary and Seamus are in partnership sharing profits and losses equally. The partnership agreement provides for annual salaries of £34,000 for Mary and £22,000 for Seamus. It also provides for interest on capital of 8 per cent per annum and interest on drawings of 5 per cent per annum. You are given the following additional information relating to the accounting year ending 30 June 20X3.

_________________________________MarySeamus

Capital at 1 July 20X2......................180,000...........60.000

Current account at I July 20X2.............33,850...........20,470

Drawings - I October 20X2..................6,000.............5,000

- 1 Match 20X3...............................12,000............4,000

Capital introduced I November 20X2.....30,000................._

Loon by Seamus (5%) - 1 April 20X3.......................50,000

The profit for the year shown in the statement of profit and loss for the year ended 30 June 20X3 was £150,000.

Required

a. Prepare the following accounts:

i. Appropriation account

ii. Capital accounts

iii. Current accounts

b. Describe the main characteristics of a partnership.