At the end of the financial year ended 30 June 2015, the trial balance of Veronica, Valda and Victoria is as shown below.

Victoria made her advance before 1 July 2014. Veronica and Valda each withdrew $12 000 on 30 September 2014, $8000 on 31 December 2014, $5000 on 31 March 2015, and the remainder on 30 June 2015. Victoria made her drawing on 30 June 2015. 

The partnership agreement contains the following provisions in relation to the allocation of profits: 

(a) A salary of $92 000 per year for Veronica and $56 000 per year for Valda. 

(b) Interest of 6% p.a. on capital contributed at the start of each financial year. 

(c) Interest on advances of 8% p.a. 

(d) Interest on drawings at 8% p.a.

Required

Prepare:

A. The Profit Distribution account for the year ended 30 June 2015.

B. The capital accounts for each partner at 30 June 2015.

C. The balance sheet as at 30 June 2015.

Transcribed Image Text:

VERONICA, VALDA AND VICTORIA Trial Balance as at 30 June 2015 Debit Credit $ 162 500 Cash at bank 248 620 178 460 Accounts receivable Inventory Equipment Accumulated depreciation – equipment 1 430 800 $ 462 600 Goodwill 360 000 Accounts payable Advance, Victoria (due for payment 31 May 2016) Capital, 30 June 2014 Veronica 345 780 320 000 160 000 320 000 Valda Victoria 640 000 Drawings: Veronica 60 000 60 000 Valda Victoria 20 000 Profit or loss summary 272 000 $2520 380 $2520 380 Note: Partnership agreement does not specify profit-sharing ratios.