Example (5-2) A, B and C are partners in ABC Company. The Company's Deed provides for...

 

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Example (5-2) A, B and C are partners in ABC Company. The Company's Deed provides for the distribution of profits and losses between partners as follows: - Salary allowances of $6,000 to B. - 15% of profits reward for C. - Interest on capital 8% on the average Partners' capital balances during the year. The average Partners' capital balances during the year are $20000, $30000, $50000 respectively. - Interest on Drawings 6%, the Partners drawing during the year are: • 1/4/2018 A Drawings of $1200 1/7/2018 B Drawings of $1000 1/9/2018 C Drawings of $2400 • 1/10/2018 A Drawings of $1000 - Divide the remaining profits and losses among the partners is shared 30%, 20%, 50% respectively. - In 2018 the ABC partnership reports net income of $30,000. Required: Prepare an Appropriation of profit & Loss account Example (5-2) A, B and C are partners in ABC Company. The Company's Deed provides for the distribution of profits and losses between partners as follows: - Salary allowances of $6,000 to B. - 15% of profits reward for C. - Interest on capital 8% on the average Partners' capital balances during the year. The average Partners' capital balances during the year are $20000, $30000, $50000 respectively. - Interest on Drawings 6%, the Partners drawing during the year are: • 1/4/2018 A Drawings of $1200 1/7/2018 B Drawings of $1000 1/9/2018 C Drawings of $2400 • 1/10/2018 A Drawings of $1000 - Divide the remaining profits and losses among the partners is shared 30%, 20%, 50% respectively. - In 2018 the ABC partnership reports net income of $30,000. Required: Prepare an Appropriation of profit & Loss account

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The question requires us to prepare an Appropriation of Profit Loss Account for the partners A B and C based on the information provided Here is the d... View the full answer