Prepare and comment on the financial statements of partnerships.
Financial statements are:
income statement
appropriation account
statement of financial position.
Preparing financial statements will involve the calculation and recording of:
interest on capital
interest on drawings
partnership salaries
interest on a partner’s loan
shares of profit and losses
revaluation of assets and treatment of goodwill.
Prepare capital and current accounts of partners.
Financial statements and partners’ accounts could require the application of the relevant terms of the Partnership Act 1890 for partners operating without agreement.
Account for changes in partnership.
Changes in partnership are:
the retirement of a partner
the admission of a new partner.
Note: the dissolution of partnerships will not be examined.
