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

Preparation of financial statements — practice question

L and M are partners, and they divide profits and losses in the proportion $3:2$. Their current account balances are shown below. 31 March 2019: L $3000$ credit, M $4500$ debit 31 March 2020: L $14200$ credit, M $6200$ debit The balances at 31 March 2020 include the effect of the following items. interest on drawings: L $1000$, M $1500$ interest on capital: L $3000$, M $2000$ drawings: L $10000$, M $15000$ What was the residual profit available for sharing between L and M for the year ended 31 March 2020?

  • A$24000
  • B$27000
  • C$29000
  • D$32000

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