Partnerships

Question 1

What is the layout of the current account?

Answer 1

DEBIT:
*Balance b/d <- Negative - partner owes business money
Drawings
Interest on Drawings
Balance c/d

CREDIT:
*Balance b/d
Interest on Capital
Salary
Profit Share

*OR

Question 2

What is the layout of the statement of financial position in a partnership?

Answer 2

Assets section does not change (same as sole trader)

Equity and liabilities Partner A Partner B Total
1. Capital

2. Current accounts
   Opening balance
   Interest on capital
   Partners salary
   Profit share
   Less: drawings
   Interest on drawings

Liabilities does not change (same as sole trader)

If the current account balance has a debt balance the amount must go in brackets.