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

Preparation of financial statements — practice question

L and M are in a partnership. The figures below are taken from their profit and loss appropriation account. Interest on capital: L $1600$, M $1800$, giving a total of $3400$ Interest charged on drawings: L $500$, M $400$, making $900$ in all Partners’ salaries: L $2000$, M $3000$, giving a combined figure of $5000$ Share of profit: L $8000$, M $12000$, with a total of $20000$ What was the profit for the year prior to appropriations?

  • A$17500$
  • B$22500$
  • C$27500$
  • D$29300$

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