Self-test The following is the trial balance of Jack and Jill as at 31 December 2009.

Capital: Jack 20,000 Capital: Jill 15,000 Current account: Jack 1,900 Current account: Jill 4,100 Purchases/sales 44,823 71,460 Debtors/creditors 6,507 6,561 Building at cost 22,000 Fixtures at book value 7,150 Salaries 6,004 Electricity 2,103 Stationery 460 Bank interest and charges 64 Stock 6,890 Bank 4,020 Drawings – Jack 1 July 2009 4,000

– Jill 1 September 2009 3,000 113,021 113,021 Additional information:

(i) Stock at 31 December 2009 was valued at £13,813.

(ii) Electricity accrued at the end of the year – £95.

(iii) Depreciation on fixtures for the year is £1,600.

The partnership agreement provides that each partner is to be credited with interest on capital at 9 per cent per annum and charged interest on any current account debit balances at 5 per cent p.a. No interest is charged on drawings during the year.

Salaries are to be provided of £8,000 per annum for Jack and £6,800 per annum for Jill. The remainder of the profit is to be divided equally between the partners. All adjustments are made to the current account as the capital account is fixed.

You are required to prepare the profit and loss account and appropriation account for the year and a balance sheet at 31 December 2009. Your workings must include the current accounts of the partners.