Question

5 Beth and Kate are in partnership. Their financial year ends on 31 December. On 1 January
20-5 their capitals were: Beth $90000 and Kate $70000. The uncompleted current
accounts for the year ended 31 December 20-5 were as follows.
Beth Kate
$
es
$
b/d
b/d 5000
10 000
20-5
Jan 1 Balance
Dec 31 Drawings
Interest on
drawings
Share of loss
Beth Kate
$
20-5
9000 Jan 1 Balance
16000 8000
Capital
160 Dec 31 Salary
320
6300 4200
Interest on
capital
Interest on loan
9000
4500 3000
200
a Explain the entry on 1 January 'Capital $10000.
b Calculate the profit or loss for the year before appropriations.
C Calculate the percentage rate of interest on capital the partners received.
d Calculate the ratio in which the partners shared the loss.
e State the balance on each partner's current account on 1 January 20-6, indicating
whether each balance is debitor credit.
f Explain what a credit balance on a partner's current account means.
g Explain how a debit balance on a partner's current account may arise.
h Suggest one reason why Beth made a loan to the business instead of investing
additional capital​

Answer 1

Answer:

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