Gce Model Questions Vol1 2020 Financial Accounting Question 22
Practice objective / multiple choice question 22 from the 2020 Gce Model Questions Vol1 Financial Accounting examination.
A partnership of A and B shares profit in the ratio 3:2. Their capitals are \(40{,}000\) and \(30{,}000\) respectively. At the beginning of the year goodwill is revalued upward by \(12{,}000\) and is to be shared in the profit‑sharing ratio. The net profit before any adjustments is \(45{,}000\). During the year A receives a salary of \(6{,}000\) and B receives \(4{,}000\). Interest on capital is charged at 5% per annum on each partner's capital. At year‑end A retires and his share of goodwill is to be paid in cash. How much cash should be paid to A on retirement?
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About This Question
This is Gce Model Questions Vol1 2020 Financial Accounting Question 22. It is one of the objective questions from the 2020 Gce Model Questions Vol1 Financial Accounting examination.
Difficulty level: Hard .
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