Part 6 Partnership accounts and company accounts 41.11 Sage and Onion are trading in partnership, sharing profits and losses equally. Interest at 5% per annum is allowed or charged on both the capital account and the current account balances at the beginning of the year. Interest is charged on drawings at 5% per annum. The partners are entitled to annual salaries of: Sage 12,000; Onion 8,000. Required: From the information given below, prepare the partnership income statement and profit and loss appropriation account for the year ending 31 December 2013, and the statement of financial posi- tion as at that date. Sage and Onion Trial Balance as at 31 December 2013 Dr Cr Capital accounts: Sage 100,000 . Onion 50,000 Current accounts: Sage 2,000 Onion 600 Cash drawings for the year: Sage Freehold premises at cost Inventory at 1 January 2013 15,000 Onion 10,000 50,000 75,000 Fixtures and fittings at cost 15,000 Purchases and purchase returns 380,000 12,000 Bank 31,600 Sales and sales returns 6,000 508,000 Accounts receivable and accounts payable 52,400 33,300 Carriage inwards 21,500 Carriage outwards 3,000 Staff salaries 42,000 VAT 8,700 Office expenses 7,500 Allowance for doubtful debts 2,000 Advertising 5,000 Discounts received 1,000 Discounts allowed 1,200 Bad debts 1,400 Rent and business rates 2,800 Accumulated provision for depreciation of fixtures and fittings 3,000 720,000 720,000 At 31 December 2013: (a) Inventory was valued at 68,000. above had not been recorded. (b) Purchase invoices amounting to 3,000 for goods included in the inventory valuation at (a) (c) Staff salaries owing 900. (d) Business rates paid in advance 200. (e) Allowance for doubtful debts to be increased to 2,400. (f) Goods withdrawn by partners for private use had not been recorded and were valued at: Sage 500, Onion 630. No interest is to be charged on these amounts. (g) Provision is to be made for depreciation of fixtures and fittings at 10% on cost. (h) Interest on drawings for the year is to be charged: Sage 360, Onion 280.