GCEFinancial AccountingPartnership Accounts2024

Ade, Bola and Chuks are in partnership sharing profits and losses in the ratio 3:2:1 respectively. The following balances were extracted from their books on 31 December 2023: Capital Accounts: Ade ₦120,000; Bola ₦90,000; Chuks ₦60,000 Current Accounts: Ade ₦18,000 (Cr); Bola ₦12,000 (Cr); Chuks ₦4,000 (Dr) Drawings: Ade ₦30,000; Bola ₦24,000; Chuks ₦18,000 Net Profit for the year: ₦90,000 The partnership agreement provides for the following: (i) Interest on capital at 10% per annum (ii) Interest on drawings: Ade ₦1,500; Bola ₦1,200; Chuks ₦900 (iii) Salary to Chuks: ₦15,000 per annum (a) Prepare the Profit and Loss Appropriation Account for the year ended 31 December 2023. (8 marks) (b) Prepare the Current Accounts of all three partners as at 31 December 2023. (7 marks)

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