BDC 201: Financial Accounting 3

Assignment (2)

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[Total: 10%]

Question 1 (2 marks)

Why partnerships give salary to their partners?

Question 2 (4 marks)

(a) Partners may also revalue their partnership assets. Give TWO (2) reasons which bring
them to make revaluation on their partnership assets.

(b) Give the journal entries for loss on revaluation of asset.

Question 3 (3 marks)

Given that the amount invested by Amy, Betty and Cindy in their partnership business are:
RM 60,000 ; RM 15,000 and RM 45,000 respectively. During the financial year ended
31 December 2011, the net profit for distribution to partners is RM 240,000. Find the amount
of profit shared by each of them.

Question 4 (5 marks)

According to the partnership business, Kent found that the following is

the record of his withdrawal from the business:

Date RM
7 February 2010 1,720
26 August 2010 1,830
9 December 2010 517

According to the agreement, partners’ drawings are charged 8.5% p.a. Find the amount for
interest on drawings in Kent’s record.

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 BDC 201: Financial Accounting 3
Assignment (2)

Question 5 (6 marks)

Roy and Jas share profit on 1/3 and 2/3 basis in their partnership business. The interest on capital
are S$5,000 andS$15,000. Salary for Jas is S$30,000. Net profit for the business is S$60,000.
Interest on drawings applied to Roy is S$700. Find the profit shared by Roy and Jas respectively.