I have just done 2 BA7 mock exams and failed, some of which were silly mistakes but I really dont understand the "partnership Appropriation Accounts.
The question is:-
P, C & L are partners having invested £8000, £9000, £2000
They share profits equally
During the year partners have drawn the following:- P £7600, C £10400, L £500
at the end of the year before interest adj the business made £21643 profit
The business pays 5% int on capital into current accounts and deducts 5% interest on partners total drawings
Assuming there was no balance on the partners current accounts at the start of the year calculate the revised balances on the partners current accounts after profit shoaring and itnerest adju at the end of the year.
Will P C & L be DR OR CR and what will the figures be
i just cant get anwhere near what ICB answers are, any help gratefully received