Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following information was taken from the books of Fox & Trot: Balances in the general ledger of Fox & Trot at the financial year

The following information was taken from the books of Fox & Trot: Balances in the general ledger of Fox & Trot at the financial year end 30 June 2017.

Accounts Debit(R) Credit(R)
Capital: H Fox 60 000.00
Capital: M. Trot 55 000.00
Current: H Fox (1 July 2016) 12 000.00
Current: M. Trot 11 000.00
Drawings: H Fox 6 000.00
Drawings: M. Trot 5 500.00
Net profit for the year( profit and loss) 345 000.00
Property, plant and equipment 447 500.00

Appropriations according to the partnership agreement at the financial year end 30 June 2017:

1. Interest on capital must be appropriated at 13% per annum. Capital account balances remain constant.

2. Interest on drawings must be appropriated at 14% per annum, as if the drawings were made 2 months prior to the end of the financial year.

3. Interest on current accounts must be appropriated at 12% per annum (on opening balances).

4. Both partners must receive an annual salary at the end of the financial year:

* H. Fox - R 27 600.00

* M. Trot - R 24 150.00

5. M. Trot must receive an annual bonus at the end of the financial year: R41 400.00

6. The remaining profit must be split between the partners in the following ratio:

* H. Fox - 3

* M. Trot - 2

REQUIRED:

Journalise the year end adjustments and appropriations(including closing transfers) in the general journal of Fox & Trot for the year ended 30 June 2017.

NB: Narrations must be provided for all journal entries.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions

Question

A 2-gallon bucket of paint costs $51.52. What is the price per pint

Answered: 1 week ago

Question

I receive useful feedback about my performance.

Answered: 1 week ago

Question

I am encouraged to offer opinions/suggestions.

Answered: 1 week ago