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3)Draw up a profit and loss appropria2on account for the year ended 31 March 20X8 and balance sheet extracts as that date, from the following: i. Net profits $111,100. ii. Interest to be charged in capitals: Blair $3,000; Short $2,000; Steel $1,500. iii. Interest to be charged on drawings: Blair $400; Short $300; Steel $200. iv. Salaries to be credited: Short $20,000; Steel $25,000. v.Profits to be shared: Blair 70%; Short 20%; Steel 10%. vi. Current account: balances b/d Blair $18,600; Short $9,460; Steel $8,200. vii. Capital account: balances b/d Blair $100,000; Short $50,000; Steel $25,000. viii. Drawings: Blair $39,000; Short $27,100; Steel $16,800.

Profit and loss appropria2on account for the year ended 31 march 20x8 $ Net Profit Add; Interest on Drawings Blair Short Steel 400 300 200 900 112,000 Less; Appropriation Interest on Capital Blair Short Steel Salary Short Steel 20,000 25,000 (45,000) 60,500 Share of Profit Blair (60,500 x 70%) Short (60,500 x 20%) Steel (60,500 x 10%) 42,350 12,100 6,050 60,500 3,000 2,000 1,500 (6,500) $ 111,100

Dr Par$culars Blair $ Drawings Interest on Drawings Bal c/d Short $ Steel $ 16,800 200 23,750

Current a/c Par$culars Blair $ Bal b/d Interest on capital Salary Share of profit 63,950 43,560

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