Question 32
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
Interest on Johnson's drawings is
- A.₦500
- B.₦300
- C.₦200
- D.₦150
- E.₦100.
Show the answer and explanation
Answer: B (₦300)
Explanation
10% × 3,000 = ₦300.