QUESTION ONE (FINANCIAL STATEMENTS - PARTNERSHIP) (60 MARKS) The following information appeared in the accounting books of Dumisani Traders, with partners Dumi and Sani, on 28 February 2020, the partnership year-end. DUMISANI TRADERS. Pre-Adjustment Trial Balance on 28 February 2020. Balance sheet accounts section Capital: Dumi Capital: Sani Drawings: Dumi Drawings: Sani Current account: Dumi- (01/03/2019) Current account: Sani - (01/03/2019) Land & Buildings Motor Vehicles Equipment Inventory Stationery - (01/03/2019) Trade receivables Deposit for electricity Bank Petty cash Cash float Trade payables Provision for bad debts- (01/03/2019) Accumulated depreciation - Vehicles-(01/03/2019) Accumulated depreciation - Equipment - (01/03/2019) Fixed deposit -Founders Bank (8% p.a.) Loan - Trust Bank Debits 356 000 288 000 102 000 1 880 000 540 000 210 000 145 000 1200 75 800 1 000 23 900 3 000 5 000 156 000 Credits 700 000 900 000 65 000 200 000 3 500 140 000 82 000 320 000

\begin{tabular}{|l|r|r|} \hline Sales & 2966000 \\ \hline Cost of sales & 890000 & \\ \hline Debtors allowances & 16000 & \\ \hline Municipality rates & 39000 & \\ \hline Water \& electricity & 43900 & \\ \hline Stationery & 6200 & \\ \hline Rent income & 7500 & \\ \hline Credit losses & 42.000 & \\ \hline Cellphone \& internet charges & 3800 & \\ \hline Interest of overdraft & & 4900 \\ \hline Credit losses recovered & 18000 & \\ \hline Insurance & 560000 & \\ \hline Salaries \& wages & & 144000 \\ \hline Fee income & 14710 & \\ \hline Bank charges & & 10400 \\ \hline Interest on fixed deposit & 5428010 & 5428010 \\ \hline \end{tabular} 11. The partnership agreement stipulates the following: - Interest on capital is calculated @ 12% p.a. Durni increased his capital by R100 000 while Sani decreased her capital by R100 000 on 01/09/2019 and these were recorded. - Dumi and Sani are entitled to R8 000 and R9000 monthly salary allowances respectively. Each partner is entitled to make a cash monthly withdrawal. However, salaries for February 2020 are still to be withdrawn. - Sani must receive an additional R43200 bonus for additional duties performed. - The remaining profits/losses are shared as follows; -Dumi: 40% -Sani: 60% Required; 1. Prepare the Statement of Profit or Loss for year ended 28 February 2020. (20) 2. Prepare the Property, Plant \& Equipment Note for the financial statements. (10) 3. Prepare the Current Accounts for both partners. (10) 4. Prepare the Statement of Financial Position as at 28 February 2020. (20) Additional information: 1. After the stock count on 28 february 2020 , the following was on hand; - Inventory - R142500 - Stationery-R1580 Note: The bookkeeper did not reverse the opening stationery on hand. 2. A debtor with a debt of R2 800 was declared insolvent and the debt must be written off. 3. The provision for bad debts must be adjusted to 5% of debtors. 4. Water \& electricity account of R1 300 for February was received but not yet paid. 5. The loan statement from Trust Bank on 28 February 2020 reflected the following: Note: Provide for the interest on loan and it must be assumed that the capital repayment of the loan will remain the same over the next financial year. 6. An annual premium of R4 800 on a policy that expires on 30/09/2020 is included in the Insurance amount. 7. The rent for March has already been recelved and entered. 8. Provide for the outstanding interest on fixed deposit. 9. On 30 November 2019, a second hand delivery truck with a cost price of R180000 and accumulated depreciation on 01/03/2019 of R108 000 was sold for R56 000 cash and this transaction is still to be recorded. 10. Depreciation on vehicles is 15% p.a. on straight line while on equipment is 10% p.a. on the reducing balance method. 11. The partnership agreement stipulates the following: The following information appeared in the accounting books of Dumisani Traders, with partners Dumi and Sani, on 28 February 2020, the partnership year-end. DUMISANI TRADERS. Pre-Adjustment Trial Balance on 28 february 2020