Accounts - Principles of Accounts Past Questions and Answers

The accounting convention which states that profit must not be recognized until realized while all losses should be adequately provided for it termed

The accounting convention which states that profit must not be recognized until realized while all losses should be adequately provided for it termed

Given:
Capital at the beginning...............N20 000
Drawings...............................N3 000
Capital................................N30 000
New capital introduced.................N8 000
What is the profit for the period?

Adamu, Babaji and Chukwu are in partnership and they share profit and losses on ratio 3:2:1. Their respective capitals are N20 000, N15 000 and N5 000 on which on which they are entitle to interest at 5% per annum. The profit for the year before charging interest on capital amounted to N5 500.
Calculate the profit for Adamu?

Faruk and Osawe are in partnership sharing profits and losses in the ratio of 3:7. Faruk is to receive a salary of N9 000. In one accounting period, the business recorded a loss of N1 500 (before deduction of Faruk's salary). The appropriate distribution of the net loss would be?