REQUIRED Use the information provided below to prepare the Statement of Changes in Equity of Samson Traders for the year ended 28 February 2023. INFORMATION The information given below was extracted from the accounting records of Samson Traders, a partnership business with Sammy and Sonny as partners. The financial year ends on the last day of February each year. Balances in the ledger on 28 February 2023 Debit (R) Capital: Sammy Capital: Sonny Current a/c: Sammy (01 March 2022) Current a/c: Sonny (01 March 2022) Drawings: Sammy Drawings: Sonny 60 000 The partners are entitled to the following monthly salaries: Sammy: R25 000 Sonny: R30 000 400 000 600 000 Credit (R) 1 200 000 800 000 100 000 The following must be considered: a) The net profit according to the Profit and loss account amounted to R1 200 000 on 28 February 2023. The partnership agreement makes provision for the following: b) Interest on capital must be provided at 15% per annum on the balances in the capital accounts. Sammy is entitled to a special bonus equal to 10% of his annual salary. Sammy and Sonny share the remaining profits or losses in the ratio of their capital balances at the end of the year.
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
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