Scot and Joplin are in partnership. They share profits in the ratio: Scot 70 per cent; Joplin 30 per cent. The following trial balance was extracted as at 31 December 2017:

Required:
Draw up a set of financial statements for the year ending 31 December 2017 for the partnership. The following notes are applicable at 31 December 2017:

(a) Inventory, 31 December 2017 £41,312.

(b) Office expenses owing £240.

(c) Provide for depreciation: motor 25 per cent of cost, office equipment 20 per cent of cost.

(d) Charge interest on capitals at 5 per cent.

(e) Charge interest on drawings; Scot £300; Joplin £200.

Transcribed Image Text:

Dr Cr Office equipment at cost Motor vehicles at cost Provision for depreciation at 31.12.2016: Motor vehicles 9,200 21,400 12,800 Office equipment 3,600 Inventory at 31 December 2016 38,410 Accounts receivable and accounts payable 41,940 32,216 Cash at bank 2,118 Cash in hand 317 Sales 180,400 Purchases 136,680 Salaries 27,400 Office expenses 2,130 Discounts allowed 312 Current accounts at 31.12.2016 Scot Joplin Capital accounts: Scot Joplin 7,382 7,009 50,000 20,000 Drawings: Scot Joplin 17,500 16,000 313,407 313,407