Question
Mr Albert calls you into his office and introduces Mr Pascoe of Pascoes Paints. He gives you a sheet of paper on which Mr Pascoe
Mr Albert calls you into his office and introduces Mr Pascoe of Pascoes Paints. He gives you a sheet of paper on which Mr Pascoe has written his cash receipts and payments for the quarter ended 30 June, 2020, and instructs you to prepare a Cash Flow statement for Mr Pascoe. You are told that the Bank Balance on 1 April 2020 was $3720.
Cash Receipts | Cash Payments | ||||
Details | $ | Details | $ |
| |
Receipts from Accounts Receivable | 130350 | Payments to Accounts Payable | 94400 |
| |
Cash Sales | 150 000 | Cash Purchases of Stock | 45 000 |
| |
Capital | 10 000 | Wages | 57 000 |
| |
LoanCBC | 20 000 | Drawings | 50 000 |
| |
|
| Prepaid Rent | 36 000 |
| |
|
| Customs Duty | 14 100 |
| |
|
| Vehicle Expenses | 8 800 |
| |
|
| Office Expenses | 23 400 |
| |
|
| Equipment | 35 000 |
| |
Required:
Prepare the cash flow statement of Pascoes Paints as requested by Mr Albert.
Mr Albert tells you that on the 1 July 2019 two clients Jim and Nelly decided to join forces and form a partnership (J&N Partners). Their contributions to the partnership were:
Jim Cash: $110000, Accounts Payable: $10000, Equipment: $50,000
Nelly Cash: $200000, Inventory: $80000, Accounts receivable: $15000
Their agreement has the following conditions:
- The partners receive 3% interest on their capital balances
- Salaries Jim - $30000 and Nelly - $40000
- The remaining profit is split equally.
- Any drawings attract a 10% interest rate for the financial year.
Mr Albert tells you that in the year to 30 June, 2020 the partnership made a profit of $175,000.00
Required:
Mr Albert asks you to prepare a Profit Distribution Schedule for the year ended 30 June 2020.
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