Prepare the profit and loss account

Assignment Help Financial Accounting

Reference no: EM133560881

Part B

From the information provided on the 30 June 2016 (2 years later) prepare the Profit and Loss Account, Profit & Loss Appropriation Account and the Partners Current Capital Accounts to show the profit distribution for the year ended 30 June 2016, and show the Partnership Funds section only of the balance sheet.

Lee has decide to reinvest their salary back in the partnership however Gillies salary is paid in cash.
All other amounts are reinvested back in the partnership.
Information:
• Gross Profit for the year ended 30 June, 2016 was $820,000.
• Other operating expenses $555,391/other operating revenue $10,000
• Lee and Gillies to each receive a salary of $70,000
• Interest on loan - Lee -$1,500
• Interest on Advance - Gillies - $500
• Profits and losses are shared equally by the partners
• Interest is allowed on partners Fixed Capital and Current Capital balances at 6% per annum
(year).
• Partners are to be allotted a bonus of $4,000 each per annum.
• Interest on drawings - Lee $255 and Gillies $270.
• Charge Gillies $615 on his current capital deficit.
• Drawings made during the year:
Lee: $6,000 Gillies: $6,000
• After all the above transactions have been recorded, transfer partners Drawings to their
Current Capital a/cs.
• Fixed capital account balances are unchanged from 15/8/15 and are $50,000 for each partner
• Current Capital a/c balances on 1/7/16: Lee $4,250 (Cr) and Gillies $6,140 (Dr)

Reference no: EM133560881

Questions Cloud

Find an example of a greenwashing or causewashing ad : Explain why it is important for companies to demonstrate their social responsibility through sustainability, green marketing, and cause marketing.

What are some specific actions lizzie can implement to help : What are some specific actions Lizzie can implement to help her line's adoption, and remove perceived risk so that customers have a high level of embracing

What is disneys sales compound annual growth rate : What is Disneys Sales Compound Annual Growth Rate (CAGR) from end of 2017 (9/30/2017) to end of 2019 (9/30/2019)? Assume Disney's 2017 sales were $55.164

Explain the marketing challenges faced by mitimeth : Analyze the Nigerian Business environment in which MitiMeth operates ???Explain the marketing challenges faced by MitiMeth ??Make suggestions for suitable

Prepare the profit and loss account : Prepare the Profit and Loss Account, Profit & Loss Appropriation Account and the Partners Current Capital Accounts to show the profit distribution for the year

Describe the freedoms protected by the 1st amendment : Describe the history of how the 1st Amendment came to be written. What were the founding fathers considering when they created the 1st Amendment.

Describe the consumer problem and trend you aim to research : Describe the consumer problem and/or trend you aim to research and identify 2-3 industries that will find your case study research useful to inform future

Effective financial options for outsourcing operations : Evaluate effective financial options for outsourcing operations of key departments, such as information systems, medical billing, and human resources (HR).

What are the two main challenges the car industry is facing : what are the two main challenges the car industry is facing? The podcast was recorded in 2020, has anything changed since then

User Account

All Pages