X, Y and Z are in partnership sharing profits and losses in the ratio 5:2:3. Y is entitled to a salary of $18 000 per annum. Partners receive interest at 6% per annum on their capital account balances at the start of the year.
At the beginning of the year, capital account balances were:
X $30 000
Y $22 000
Z $20 000
The net profit before salary and interest for the year is $140 000.
What is Y's share of the total profits?

Q: What topic does this question test?

This question tests Partnerships in A-Level Accounting (syllabus code 9706). It is worth 1 mark.

Q: Which exam paper is this question from?

This question appeared in the Cambridge A-Level Accounting May/June 2010 examination, Paper 1 Variant 2 (9706_s10_qp_12.pdf).

Question

X, Y and Z are in partnership sharing profits and losses in the ratio 5:2:3. Y is entitled to a salary of $18 000 per annum. Partners receive interest at 6% per annum on their capital account balances at the start of the year.
At the beginning of the year, capital account balances were:
X $30 000
Y $22 000
Z $20 000
The net profit before salary and interest for the year is $140 000.
What is Y's share of the total profits?

Oracle Prep · Accepted Answer

The correct answer is C: $42 856.

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