Question

Extract from the ledger of Casper Limited on 30 June 2020:

R
Capital: Bruce   400 000
Capital: Lee 300 000
Current a/c: Bruce (01 July 2019) 45 000 CR
Current a/c: Lee (01 July 2019) 42 000 DR
Drawings: Bruce 95 000
Drawings: Lee 110 000

The following must be taken into account:
1. On 30 June 2020 the Profit and Loss account reflected a net profit of R940 000.

2. Partners are entitled to interest at 14% p.a. on their capital balances.
Note: Bruce decreased his capital contribution by R90 000 on 01 July 2019. This capital decrease has been recorded.
3. Partners are entitled to the following monthly salaries:
 Bruce R13 000 for the first ten months of the financial year and R15 000 for the next two months.
 Lee R10 000 per month throughout the year.

4. Partner Lee is entitled to a bonus equal to 10% of the net profit before any of the above appropriations have been taken into account.
5. The remaining profit/shortfall must be shared equally between Bruce and Lee.

REQUIRED
Prepare the Statement of Changes in Equity for the year ended 30 June 2020.

Answer 1