QUESTION 4 PARTNERSHIPS (20 MARKS) The information given below was extracted from the accounting records of Gateway Traders, a partnership business with Gatehead and Wayne as partners. REQUIRED Prepare the Statement of Changes in Equity for the year ended 29 February 2016. Use the following format STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 29 February 2016 Wayne (R Gatehead (R) Total (R) Capital Accounts Balance at 28 February 2015 Changes in capital Balance at 29 February 2016 Wayne (R) Total (R) Gatehead (R) Current Accounts Balance at 28 February 2015 Net profit for the year Interest on capital Salaries Bonus Profit Share Drawings Balance at 29 February 2016 INFORMATION Extract from the ledger of Gateway Traders as at 29 February 2016 400 000 pital: Gatehead Capital: Wayne 300 000 Current alc: Gatehead (01 March 2015) 25 000 DR Current a/c: Wayne (01 March 2015) 30 000 CR Drawings: Gatehead 150 000 Drawings: Wayne 200 000 The following must be taken into account: a) On 29 February 2016 the Statement of Comprehensive Income reflected a net profit of R500 000. (b) The partnership agreement provided for interest on capital at 10% pa. on the balances on the capital accounts. However, the partners agreed to increase the interest rate to 12% pa, with effect from 01 September 2015. (c) The partners are entitled to the following monthly salaries: Gatehead R13 000 Wayne R12 000 Wayne is entitled to a special bonus of 10% of the net profit (before any appropriations). The balance of the profit must be shared between Gatehead and Wayne in the ratio 3:2 (e) respectively