WAEC Financial Accounting 2022 Question 32

Question 32

Partnership Accounts

Use the following information to answer questions 32 to 34
Teteh and Kukuma are in partnership with capital balances of ₦300,000 and ₦200,000 respectively. They agreed to share profit on the basis of their capital. The profit for the year is ₦150,000 and the interest on capital is 5%.
Teteh's share of profit is

  1. A.₦90,000
  2. B.₦75,000
  3. C.₦60,000
  4. D.₦50,000
Show the answer and explanation

Answer: B (₦75,000)

Explanation

Interest on capital = 15,000 + 10,000; residual 125,000 shared 3:2 gives Teteh ₦75,000.