Prepare the capital accounts, Cost Accounting

Assignment Help:

Shirley and Ken are in partnership, trading in the construction industry. The year end for the partnership business is 30 June.

You are the Assistant Accountant and have been asked by the Accountant to assist him in preparing the financial statements for the year ended 30 June 2011.

You have the following information about the partnership:

The partners are Shirley and Ken.

  • Their capital account balances as at 1 July 2010 were:

                   -    Shirley       £32,000

                   -    Ken           £57,000

  • Partner's current account balances as at 1 July 2010 were:

                     -    Shirley       £1,900 Cr

                     -    Ken              £400 Dr

  • Partner's annual salaries:

                    -    Shirley       £7,500

                    -    Ken           £9,500

  • Partners' interest on capital is charged at 3% per annum on the capital account balances at the start of the year and from when a new partner joins the partnership.
  • Reeny was admitted to the partnership on 1 January 2011 when she introduced £25,500 into the business' bank account.
  • The profit sharing ratio, effective until 31 December 2010 was:

                -  Shirley        45%

                -    Ken           55%

  • The profit sharing ratio, effective from 1 January 2011 was:

               -    Shirley                   40%
               -    Ken                       45%
               -    Reeny                    15%

  • Goodwill was introduce into the partner's capital accounts at a valued of £27,500 and then eliminated on 1 January 2011.

Related Discussions:- Prepare the capital accounts

Cost volume profit analysis, Cost Volume Profit Analysis 1. Post Publish...

Cost Volume Profit Analysis 1. Post Publishers has collected the following data for recent months: Month                 Issues published              Total cost May

Calculate the payback period and the accounting rate, Freshly Ground Invest...

Freshly Ground Investments have just made an investment of $550 000 in a new Toyota Hilux (with trailer) delivery vehicle. This vehicle will be used for deliveries and generate rev

Calculate the cash flow - capital cost, A company is evaluating the followi...

A company is evaluating the following lease or buy option.  A four year lease with annual payments of $25,000 payable at the beginning of the year. The tax shield is available a

Sunk costs, Which statement best describes a sunk cost? A a cost which is i...

Which statement best describes a sunk cost? A a cost which is irrelevant for the future B a cost which must be matched against the revenue C a cost which remains the same at all le

Cost accounting as a service activity, critically explain cost accounting a...

critically explain cost accounting as 1. a service activity 2. a descriptive/analytical discipline 3. an information system

labour cost as the focus, Using  labour  cost  as  the  focus,  discus...

Using  labour  cost  as  the  focus,  discuss  the  differences  in  the measurement  of  labour efficiency / effectiveness where (i)  total quality management techniques and (ii)

Week 2 Assignment, Please complete the following 7 exercises below in eithe...

Please complete the following 7 exercises below in either Excel or a word document (but must be single document). You must show your work where appropriate (leaving the calculation

Determine the total after-tax annual cost, What is the total after-tax annu...

What is the total after-tax annual cost of a machine producing bolts with a first cost of $45,000 and operating and maintenance costs of $0.22 per unit per day? It will be sold for

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd