Required:
Prepare the following in respect of S & W Patio Furniture Traders to comply with the
requirements of International Financial Reporting Standards appropriate to the business of the partnership:
(a) Statement of profit or loss and other comprehensive income for the year ended 28 February 20.8;
(b) Statement of changes in equity for the year ended 28 February 20.8;
(c) Statement of financial position as at 28 February 20.8;
(d) The note for property, plant and equipment for the year ended 28 February 20.8. No other notes are required.
The following information relates to the partnership S \& W Patio Fumiture with partners S Simi and W Wihan: Additional information: S \& W Patio Furniture sells merchandise on a cash basis only. Abstract from terms of the partnership agreement: 1. Interest on the opening balances of the capital accounts will be calculated at a per annum rate of twice the average prime lending rate," as determined by the SA Reserve Bank. During the financial year the prime lending rate was as follows: first quarter of the financial year; 6.0%; second quarter; 5.5%; third quarter. 5.0% and fourth quarter; 4.5%. Interest is calculated at a rate of 8.0% per annum on the opening balances of the current accounts. The interest on capital and current accounts must be capitalised to the current accounts of the partners. 2. Interest will be charged at a rate of 10% per annum on the balance of the drawings accounts at the end of each month. The interest must be capitalised against the current accounts of the partners. 2. S Simi is entitled to an annual salary of R75 000 and W Wihan is entitled to an annual salary of R65 000 . 3. The partners share profits and losses equally. Year-end adjustments: 1. Depreciation must be provided as follows: Equipment: 15% per annum according to the straight line method; and Vehicles: 20% per annum according to the diminishing balance method. 2. The terms of the mortgage provide for interest on the loan to be calculated at a rate of 10% per annum on the outstanding amount of the loan at the end of the financial year. Interest is payable in the first week of March of the following year. On 5 March 20.8, the partnership must repay an amount of R35 000 of the loan. The loan is secured by a mortgage over land and buildings and was granted to the partnership by Bond Bank Limited on 1 March 20.6. The balance of the loan is repayable in full in March 20.15. 3. S Simi granted an unsecured loan to the partnership on 1 September 20.7. According to the terms of the loan agreement, interest at 12% per annum will be charged and is payable in March of every year. An amount equal to 40% of the Ioan is repayable on 1 September 20.8 . The remaining balance of this loan is repayable in full in September 20.10. 4. Advertising expenses exclude an amount of R1 200 which is still payable for the current financial year. 5. The amount paid for water and electricity includes an amount of R3 000 paid for March 20.8. 6. Cell phone expenses incurred by the partners are paid for by the partnership due to the fact that the partners Simi and Wihan use their cell phones mainly for business purposes. The amount payable for February 20.8 towards the cell phone expenses of Simi is R1 000 and towards the cell phone expenses of Winan, R700 and must still be provided for. 7. An amount of R26 000 for commission to sales representatives for February 20.8 still has to be accounted for. 8. During the year, the following cash salaries were withdrawn by the partners: S Simi, R14 900 and W Wihan, R23 100. 9.Interest calculated on the partners' drawings accounts, as per the partnership agreement, amounted to R1 490 for Simi and R2 500 for Wihan for the current financial year and must still be recorded. 10. Provisions/adjustments to comply with the terms of the partnership agreement must still be made. u can google "prime lending rate" to learn more. The following information relates to the partnership S \& W Patio Fumiture with partners S Simi and W Wihan: Additional information: S \& W Patio Furniture sells merchandise on a cash basis only. Abstract from terms of the partnership agreement: 1. Interest on the opening balances of the capital accounts will be calculated at a per annum rate of twice the average prime lending rate," as determined by the SA Reserve Bank. During the financial year the prime lending rate was as follows: first quarter of the financial year; 6.0%; second quarter; 5.5%; third quarter. 5.0% and fourth quarter; 4.5%. Interest is calculated at a rate of 8.0% per annum on the opening balances of the current accounts. The interest on capital and current accounts must be capitalised to the current accounts of the partners. 2. Interest will be charged at a rate of 10% per annum on the balance of the drawings accounts at the end of each month. The interest must be capitalised against the current accounts of the partners. 2. S Simi is entitled to an annual salary of R75 000 and W Wihan is entitled to an annual salary of R65 000 . 3. The partners share profits and losses equally. Year-end adjustments: 1. Depreciation must be provided as follows: Equipment: 15% per annum according to the straight line method; and Vehicles: 20% per annum according to the diminishing balance method. 2. The terms of the mortgage provide for interest on the loan to be calculated at a rate of 10% per annum on the outstanding amount of the loan at the end of the financial year. Interest is payable in the first week of March of the following year. On 5 March 20.8, the partnership must repay an amount of R35 000 of the loan. The loan is secured by a mortgage over land and buildings and was granted to the partnership by Bond Bank Limited on 1 March 20.6. The balance of the loan is repayable in full in March 20.15. 3. S Simi granted an unsecured loan to the partnership on 1 September 20.7. According to the terms of the loan agreement, interest at 12% per annum will be charged and is payable in March of every year. An amount equal to 40% of the Ioan is repayable on 1 September 20.8 . The remaining balance of this loan is repayable in full in September 20.10. 4. Advertising expenses exclude an amount of R1 200 which is still payable for the current financial year. 5. The amount paid for water and electricity includes an amount of R3 000 paid for March 20.8. 6. Cell phone expenses incurred by the partners are paid for by the partnership due to the fact that the partners Simi and Wihan use their cell phones mainly for business purposes. The amount payable for February 20.8 towards the cell phone expenses of Simi is R1 000 and towards the cell phone expenses of Winan, R700 and must still be provided for. 7. An amount of R26 000 for commission to sales representatives for February 20.8 still has to be accounted for. 8. During the year, the following cash salaries were withdrawn by the partners: S Simi, R14 900 and W Wihan, R23 100. 9.Interest calculated on the partners' drawings accounts, as per the partnership agreement, amounted to R1 490 for Simi and R2 500 for Wihan for the current financial year and must still be recorded. 10. Provisions/adjustments to comply with the terms of the partnership agreement must still be made. u can google "prime lending rate" to learn more
