REQUIRED Use the information provided below to prepare the Statement of Changes in Equity for the year ended 28 February 2023. INFORMATION The information given below was extracted from the accounting records of Maximum Traders, a partnership business with Maxi and Mumtaz as partners. Balances in the ledger on 28 February 2023 Capital: Maxi Capital: Mumtaz Current a/c: Maxi (01 March 2022) Current a/c: Mumtaz (01 March 2022) Drawings: Maxi Drawings: Mumtaz Debit R 30 000 300 000 200 000 Credit R 600 000 400 000 40 000 The following must be considered: The net profit according to the Profit and loss account amounted to R600 000 on 28 February 2023. The sales for the year ended 28 February 2023 amounted to R1 500 000. (b) The partnership agreement makes provision for the following: Interest on capital must be provided at 12% per annum on the balances in the capital accounts. Note: The partners increased their capital contributions by R100 000 each on 01 January 2023. The capital changes have been recorded. The partners are entitled to the following monthly salaries: Maxi R11 000 R10 000 Mumtaz Maxi is entitled to a special bonus equal to 6% of the annual sales. Maxi and Mumtaz share the remaining profits or losses in the ratio of their capital balances at the end of the financial year.
REQUIRED Use the information provided below to prepare the Statement of Changes in Equity for the year ended 28 February 2023. INFORMATION The information given below was extracted from the accounting records of Maximum Traders, a partnership business with Maxi and Mumtaz as partners. Balances in the ledger on 28 February 2023 Capital: Maxi Capital: Mumtaz Current a/c: Maxi (01 March 2022) Current a/c: Mumtaz (01 March 2022) Drawings: Maxi Drawings: Mumtaz Debit R 30 000 300 000 200 000 Credit R 600 000 400 000 40 000 The following must be considered: The net profit according to the Profit and loss account amounted to R600 000 on 28 February 2023. The sales for the year ended 28 February 2023 amounted to R1 500 000. (b) The partnership agreement makes provision for the following: Interest on capital must be provided at 12% per annum on the balances in the capital accounts. Note: The partners increased their capital contributions by R100 000 each on 01 January 2023. The capital changes have been recorded. The partners are entitled to the following monthly salaries: Maxi R11 000 R10 000 Mumtaz Maxi is entitled to a special bonus equal to 6% of the annual sales. Maxi and Mumtaz share the remaining profits or losses in the ratio of their capital balances at the end of the financial year.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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prepare the statement of changes in Equity for the year ended 28 February 2023 for maximum traders
Transcribed Image Text:REQUIRED
Use the information provided below to prepare the Statement of Changes in Equity for the year ended
28 February 2023.
INFORMATION
Balances in the ledger on 28 February 2023
(a)
The information given below was extracted from the accounting records of Maximum Traders, a
partnership business with Maxi and Mumtaz as partners.
Capital: Maxi
Capital: Mumtaz
Current a/c: Maxi (01 March 2022)
Current a/c: Mumtaz (01 March 2022)
Drawings: Maxi
Drawings: Mumtaz
(b)
Debit
R
30 000
300 000
200 000
Credit
R
600 000
400 000
40 000
The following must be considered:
The net profit according to the Profit and loss account amounted to R600 000 on 28 February 2023.
The sales for the year ended 28 February 2023 amounted to R1 500 000.
The partnership agreement makes provision for the following:
Interest on capital must be provided at 12% per annum on the balances in the capital accounts.
Note: The partners increased their capital contributions by R100 000 each on 01 January 2023.
The capital changes have been recorded.
The partners are entitled to the following monthly salaries:
Maxi
R11 000
Mumtaz
R10 000
Maxi is entitled to a special bonus equal to 6% of the annual sales.
Maxi and Mumtaz share the remaining profits or losses in the ratio of their capital balances at the
end of the financial year.
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