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WAEC Financial Accounting 2022 Question 34

Question 34

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 interest on capital is

  1. A.₦75,000
  2. B.₦25,000
  3. C.₦15,000
  4. D.₦10,000
Show the answer and explanation

Answer: C (₦15,000)

Explanation

5% × 300,000 = ₦15,000.