Light and Dark are in partnership sharing profits and losses in the ratio 7 : 3, respectively. The following information has been taken from the partnership records for the financial year ended 31 May 20X9:
Partners’ capital accounts, balances as at 1 June 20X8:

Partners’ current accounts, balances as at 1 June 20X8:

During the year ended 31 May 20X9 the partners made the following drawings from the partnership bank account:

Interest is to be charged on drawings at the rate of 12 per cent per annum. Interest is allowed on capital accounts and credit balances on current accounts at the rate of 12 per cent per annum.
Dark is to be allowed a salary of £15,000 per annum.
The net profit of the partnership for the year ended 31 May 20X9 is £102,940.

Required
a. A computation of the amount of interest chargeable on each partner’s drawings for the year ended 31 May 20X9.
b. The partnership appropriation account for the year ended 31 May 20X9.
c. A computation of the balance on each partner’s current account as at 31 May 20X9.

Transcribed Image Text:

Light Dark £200,000 £140,000