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Homework answers / question archive / The information provided relates to ST Traders
The information provided relates to ST Traders. The business is a partnership owned by Sam and Tom Tibs. The financial year ended on 28 February 2020. Information: Extract from the Trial Balance on 28 February 2020 750 000 500 000 6750 9 800 (OR) 820 000 Capital: Sam Capital: Tom Current Account: Sam (01 March 2019) Current Account Tom (01 March 2019) Drawings. Sam Drawings Tom Loan: Drago Bank Bank (cr) Cash Float Inventories Trade and other Receivables Trade and other payables Sales Profit and loss (net profit for the year) 7750 (CR) 1.300 28 620 37 500 32 300 1120 000 ?
dye view A' Read alo 2. Partners' earnings and drawings: Sam earns a salary of R102 000 per year. Tom eams 5% more than Sam. Interest on capital is calculated at 8% pa. Tom's interest amounts to R40 000. Note that Sam increased his capital by R25 000 on 1 December 2019. This was recorded accordingly. Tom is entitled to a production bonus equal to 1,5% of turnover. The remaining profit or loss is shared between Sam and Tom in the ratio 3 2 respectively. The remaining profit earned by Tom was R7 500 after all adjustments were done. Tom also withdrew 60% of his total earnings for this financial year. Sam ended with a credit balance of R32 550 on his current account Required Complete the Current account note (Use below. format and figures provided as well, calculate and fill in the missing figures) NOTE : CURRENT ACCOUNT SAM TOM TOTAL Salaries 102 000 Interest on capital 40 000 Bonus Primary distribution of profits Final distribution of profits 7 500 Net profit as per income statement
Required: Complete the Current account note (Use below format and figures provided as well, calculate and fill in the missing figures) NOTE : CURRENT ACCOUNT SAM TOM TOTAL Salaries 102 000 Interest on capital 40 000 Bonus Primary distribution of profits Final distribution of profits 7 500 Net profit as per income statement Drawings Retained income for the year Balance at the beginning of the year 6 750 Balance at end of the year. 32 550
Note : Current AccountPARTICULARSSAMTOMTOTALSalaries102000107100209100(102000*105%)Interest on capital585004000098500(725000*8%+25000*8%*3/12)Bonus01680016800(1120000*1.5%)Primary distribution of profit160500163900324400Final distribution of profits11250750018750(7500*5/2*3/5)Net profit as per income statement171750171400343150Drawings14595068560214510(171750-25800)(171400*60%)Retained income for the year25800102840128640(32550-6750)Balance at the begining of the year6750-9800-3050Balance at the end of year3255093040125590
