Question 2 Study the scenario and complete the questions that follow: Apple and Pie's Partnership On 21 February 2005, Apple and Pie decided to form a partnership trading as ApplePie Furniture and Fittings. The partnership will commence trading on 1 March 2005 and both partners will be actively involved in the partnership. Apple and Pie accordingly drew up the partnership agreement stipulating the following: 1. Apple will contribute R100 000 in cash towards the capital of the business. Pie will contribute R40 000 in cash, a delivery vehicle with a fair market value of R60 000 and office equipment worth R60 000. 2. Each partner will receive a monthly salary of R5 000. 3. Interest on relevant accounts at year-end will be charged as follows: 10% per annum on the opening balance of the capital accounts 12% per annum on the opening balance of the current accounts No interest will be charged on drawings The following is a summary of the business transactions for the year ended 28 February 2006: Receipts Payments Cash sales of inventory: R425 000. Salaries withdrawn: Apple - R45 000 and Pie - R45 000. Cash purchases of inventory, R110 000. Salaries paid to sales personnel, R60 000. Rent paid, R36 000 Other operating expenses paid in cash, R40 000. Other information: Drawings of inventory: Screenshot Apple -R4 000 and Pie - R6 000 On 1 September 2005, Apple granted a loan of R20 000 to the partnership. The terms of the loan state that interest on the loan will be calculated at 14% per annum payable in March of each year and the loan will be repaid in full on 31 December 2009. The loan was used to finance the purchase of additional office equipment on 1 September 2005. Depreciation must be provided for as follows: Office equipment at 10% per annum, according to the straight-line method Vehicles at 20% per annum, according to the diminishing balance method. Source: Adapted from Doussy, F., Ngcobo, R.N., Rehwinkel, A., Scheepers, D., Scott, D., Jansen Van Rensburg, J.S. 2016. About financial accounting: Volume 2. Durban: LexisNexis. Required Prepare the following in the books of ApplePie Furniture and Fittings for the year-ended 28 February 2006: 2.1 Calculate the profit share to be recorded in the partners' current accounts (16 Marks) 2.2 Capital accounts in the General Ledger (9 Marks) End of Section B Screenshot Question 2 Study the scenario and complete the questions that follow: Apple and Pie's Partnership On 21 February 2005, Apple and Pie decided to form a partnership trading as ApplePie Furniture and Fittings. The partnership will commence trading on 1 March 2005 and both partners will be actively involved in the partnership. Apple and Pie accordingly drew up the partnership agreement stipulating the following: 1. Apple will contribute R100 000 in cash towards the capital of the business. Pie will contribute R40 000 in cash, a delivery vehicle with a fair market value of R60 000 and office equipment worth R60 000. 2. Each partner will receive a monthly salary of R5 000. 3. Interest on relevant accounts at year-end will be charged as follows: 10% per annum on the opening balance of the capital accounts 12% per annum on the opening balance of the current accounts No interest will be charged on drawings The following is a summary of the business transactions for the year ended 28 February 2006: Receipts Payments Cash sales of inventory: R425 000. Salaries withdrawn: Apple - R45 000 and Pie - R45 000. Cash purchases of inventory, R110 000. Salaries paid to sales personnel, R60 000. Rent paid, R36 000 Other operating expenses paid in cash, R40 000. Other information: Drawings of inventory: Screenshot Apple -R4 000 and Pie - R6 000 On 1 September 2005, Apple granted a loan of R20 000 to the partnership. The terms of the loan state that interest on the loan will be calculated at 14% per annum payable in March of each year and the loan will be repaid in full on 31 December 2009. The loan was used to finance the purchase of additional office equipment on 1 September 2005. Depreciation must be provided for as follows: Office equipment at 10% per annum, according to the straight-line method Vehicles at 20% per annum, according to the diminishing balance method. Source: Adapted from Doussy, F., Ngcobo, R.N., Rehwinkel, A., Scheepers, D., Scott, D., Jansen Van Rensburg, J.S. 2016. About financial accounting: Volume 2. Durban: LexisNexis. Required Prepare the following in the books of ApplePie Furniture and Fittings for the year-ended 28 February 2006: 2.1 Calculate the profit share to be recorded in the partners' current accounts (16 Marks) 2.2 Capital accounts in the General Ledger (9 Marks) End of Section B Screenshot