Question 29
Partnership AccountsJohn and Johnson are in partnership, sharing profit and losses in the ratio 3:2. Other information are as follows:
Capital: John ₦20,000; Johnson ₦10,000
Drawings: John ₦2,000; Johnson ₦3,000
Interest on capital: 5%
Interest on drawings: 10%
Profit: ₦6,000
What is Johnson's share of the profit?
- A.₦6,000
- B.₦3,600
- C.₦3,000
- D.₦2,400
- E.₦2,000.
Show the answer and explanation
Answer: E (₦2,000.)
Explanation
Johnson gets 2/5 of 5,000 = ₦2,000.