A, B, C and D were partners in a garage business comprising (1) petrol sales, (2) repairs and servicing and (3) second-hand car dealing. A was responsible for petrol sales, B for repairs and servicing and C for second-hand car deals, while D acted purely in an advisory capacity.

The partnership agreement provided the following:

1. Interest on fixed capital is to be provided at a rate of 10 per cent per annum.

a. Each working partner is to receive commission of 10 per cent of the gross profit of that partner's own department.

b. Profits are shared as follows: A: , B: , C: , D:

c. Financial statements are to be made up annually to 30 September.

A trial balance extracted from the books at 30 September 20X3 showed the following balances:

Additional information
1. Inventories at 30 September 20X3:
Petrol................1050
Spares.................475
Second-hand cars..9680
Depreciation on tools and equipment is to be provided at 5 per cent per annum by the straight-line method.
3. Your fees for preparation of the financial statements will be £175.
4. The service department did work valued at £11,300 on the second-hand cars.
5. The service department used old cars valued at £550 for spare parts in services and repairs.
Required
a. Prepare a statement of profit and loss for the year ended 30 September 20X3.
b. Prepare a statement of financial position at 30 September 20X3.
c. The partners' current accounts in columnar form for the year.

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Debit Credit A Copital account 3.500 1,350 Current account Drawings account 6,000 8 Copital account 7,500 Current occount Drawings occount 7,500 13,250 C Copital account 6500 5,500 Curent account Drowings occount 10,500 12,500 2,150 D Copital account Curent account Drawings occount Freehold premises at cost 3,500 25,000 0,000 9,000 Goodwil at cost Servicing tools and equipment at cos Servicing tools and equipment occumulated depreciation to 1 October 2032 Bank balance Inventories at 1 October 20X2 petol 1,350 10,105 950 525 6,350 4,350 125 -spare - second-hand cars Trade receivables Cosh in hand Trade payables Sales- petrol 2.350 68,650 86,750 156,000 -servicing ond repairs cars Purchases petrol 58,500 51,650 118,530 5,750 31,350 8,550 1,850 2,500 1,800 550 775 350 -spores - second-hand cars Wages forecout attendonts - mechonics - car sales staff -office personnel Rates Office expenses Heating and lighting Advortisng Bank intarest 371,705 371,705