Saud, Salim and Sulaimon started a partnership firm on January 1, 2019. They contributed RO. 50,000, RO. 40,000 and RO. 30,000 respectively as their capitals and decided to share profits in the ratio of 3:2:1. The partnership deed provided that Saud is to be paid salary of RO. 12000 p.a. and Salim commission of RO. 2,500 every 6 months. It also provided that interest on capital be allowed @ 6% p.a. The drawings for the year were: Saud RO. 6,000, Salim RO. 4,000 and Sulaimon RO. 2,000. Interest on drawings was RO. 270 for Saud, RO.180 for Salim and RO. 90 for Sulaimon. The net amount of profit as per the profit and loss account for the year ended 2019 was RO. 35,660.

Prepare the necessary accounting entries, the profit and loss appropriation account and the partners' capital accounts. Based on the above information answer the following 5 questions. (Do not upload any documents)

At the end of the year, the share of profit eligible for partners after all adjustments will be:

a.

Saud: RO 12000, Salim: RO 8000, Sulaimon: RO 4000

b.

Saud: RO 6000, Salim: RO 6000, Sulaimon: RO 2000

c.

Saud: RO 3000, Salim: RO 2000, Sulaimon: RO 1000

d.

Saud: RO 9000, Salim: RO 6000, Sulaimon: RO 3000

Identify which one of the following accounting entry for payment of salary to partner Saud at the end of the year:

a.

Dr: Saud's salary account RO 1000 Cr: Saud's capital account RO 1000

b.

Dr: Saud's Salary account RO 12000 Cr: Saud's capital accountRO 12000

c.

Dr: Saud's capital account RO 12000 Cr: Saud's salary account RO 12000

d.

Dr: Saud's capital accountRO 1000 Cr: Saud's salary account RO 1000

The accounting entry for charging interest on drawings to each partners will be:

a.

Dr: Saud's capital account RO 135

Dr: Salim's capital account RO 90

Dr: Sulaimon's capital account RO 45

Cr: Interest on drawings account RO 270

b.

Dr: Saud's capital account RO 270

Dr: Salim's capital account RO 180

Dr: Sulaimon's capital account RO 90

Cr: Interest on drawings account RO 540

c.

Dr; Interest on drawing account RO 270

Cr: Saud's capital account RO 135

Cr: Salim's capital account RO 90

Cr: Sulaimon's capital account RO 45

d.

Dr: Saud's capital account RO 270

Dr: Salim's capital account RO 180

Dr: Sulaimon's capital account RO 90

Cr: Profit and loss account RO 540

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The balance of capital for partner Salim at the end of the year will be:

a.

RO 40720

b.

RO 47220

c.

RO 42270

d.

RO 42720

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Question 45

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The balance of capital for partner Sulaimon at the end of the year will be:

a.

RO 15485

b.

RO 31710

c.

RO 37110

d.

RO 15885