Chip, Dale, and Duck are partners of a trading firm and share profits and losses in the ratio 3:2:1. The firm’s SFP on 31 December 20x6 was as follows:

Dale retired from the partnership on 1 January 20x7 and agreed to leave half the final balance on his capital account as a short-term loan to the firm. The remainder was paid to him in cash immediately.
Chip and Duck agreed to continue in partnership, sharing profits and losses in the same proportions as before. Unrecorded goodwill on 1 January was valued at £18,000.

Requied:
1. Capital accounts of Chip, Dale and Duck as of 1 January 20x7.
2. Dale’s loan account as of 1 January 20x7.

Transcribed Image Text:

Non-current assets Freehold premises Motor vehicles at cost less depreciation Current assets Inventory Receivables Balance at bank Current liabilities h 25,000 19,000 44,000 12,000 15,000 11,000 38,000 8,000 8,000 74,000 Payables Net assets Partners' capital accounts L Chip 36,000 Dale 24,000 Duck 12,000 72,000 Partners' current accounts Chip 2,400 Dale Dr (1,600) Duck 1,200 2,000 74,000