Use the information provided below to prepare the Statement of Changes in Equity for the year ended 28 February 2023. INFORMATION The information given below was extracted from the accounting records of Kelso Traders, a partnership business with Kelly and Solly as partners. Balances in the ledger as at 28 February 2023 Capital: Kelly Capital: Solly Current a/c: Kelly (01 March 2022) Current a/c: Solly (01 March 2022) Drawings: Kelly Drawings: Solly Debit R 40 000 800 000 600 000 Credit R 1 000 000 600 000 100 000 The following must be considered: (a) The net profit according to the Statement of Comprehensive Income amounted to R1 600 000 on 28 February 2023 (the end of the financial year). The sales for the year ended 28 February 2023 amounted to R4 000 000. (b) The partnership agreement makes provision for the following: Interest on capital must be provided at 15% per annum on the balances in the capital accounts. Note: The partners increased their capital contributions by R200 000 each on 28 February 2023. The capital changes have been recorded. The partners are entitled to the following monthly salaries: Kelly R20 000 Solly R15 000 Kelly is entitled to a special bonus equal to 5% of the amount by which the annual sales exceed R3 000 000. Kelly and Solly share the remaining profits or losses in the ratio 3:2 respectively.
Use the information provided below to prepare the Statement of Changes in Equity for the year ended 28 February 2023. INFORMATION The information given below was extracted from the accounting records of Kelso Traders, a partnership business with Kelly and Solly as partners. Balances in the ledger as at 28 February 2023 Capital: Kelly Capital: Solly Current a/c: Kelly (01 March 2022) Current a/c: Solly (01 March 2022) Drawings: Kelly Drawings: Solly Debit R 40 000 800 000 600 000 Credit R 1 000 000 600 000 100 000 The following must be considered: (a) The net profit according to the Statement of Comprehensive Income amounted to R1 600 000 on 28 February 2023 (the end of the financial year). The sales for the year ended 28 February 2023 amounted to R4 000 000. (b) The partnership agreement makes provision for the following: Interest on capital must be provided at 15% per annum on the balances in the capital accounts. Note: The partners increased their capital contributions by R200 000 each on 28 February 2023. The capital changes have been recorded. The partners are entitled to the following monthly salaries: Kelly R20 000 Solly R15 000 Kelly is entitled to a special bonus equal to 5% of the amount by which the annual sales exceed R3 000 000. Kelly and Solly share the remaining profits or losses in the ratio 3:2 respectively.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Can you kindly assist with the attached question. All information on the attachment. Thanks
Transcribed Image Text:Use the information provided below to prepare the Statement of Changes in Equity for the year ended
28 February 2023.
INFORMATION
The information given below was extracted from the accounting records of Kelso Traders, a partnership
business with Kelly and Solly as partners.
Balances in the ledger as at 28 February 2023
Capital: Kelly
Capital: Solly
Current a/c: Kelly (01 March 2022)
Current a/c: Solly (01 March 2022)
Drawings: Kelly
Drawings: Solly
Debit
R
40 000
800 000
600 000
Credit
R
1 000 000
600 000
100 000
The following must be considered:
(a) The net profit according to the Statement of Comprehensive Income amounted to R1 600 000 on 28
February 2023 (the end of the financial year). The sales for the year ended 28 February 2023 amounted
to R4 000 000.
(b) The partnership agreement makes provision for the following:
■
Interest on capital must be provided at 15% per annum on the balances in the capital accounts.
Note: The partners increased their capital contributions by R200 000 each on 28 February 2023. The
capital changes have been recorded.
■ The partners are entitled to the following monthly salaries:
Kelly
Solly
R20 000
R15 000
■ Kelly is entitled to a special bonus equal to 5% of the amount by which the annual sales exceed
R3 000 000.
■ Kelly and Solly share the remaining profits or losses in the ratio 3:2 respectively.
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