Accounting 9706 · AS & A Level · Preparation of financial statements

Preparation of financial statements — practice question

L and M are partners, and their profits and losses are shared in proportion to the capital each has put into the business. The information below is given: capital: L $68{,}000, M $102{,}000 profit for the year before appropriation $28{,}900 drawings: L $8000, M $12{,}000 No interest is payable on drawings of up to $10{,}000 for each partner. Any drawings above $10{,}000 are charged interest at $5\%$. How much of the residual profit belonged to L?

  • A$11{,}520
  • B$11{,}600
  • C$11{,}800
  • D$11{,}960

Worked solution & mark scheme

This 1-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI