O-LevelAccountingAnalysis and interpretation7707/11 · Oct/Nov 2015 · Q191 Mark

Rajid and Sunil formed a partnership on 1 January 2014 but did not prepare a partnership agreement. They provided the following information. Rajid | Sunil capital introduced 1 January 2014 | $40000 | $20000 during the year ended 31 December 2014 drawings | $5000 | $3500 share of work | 50% | 50% They decide to draw up a partnership agreement for future years. Which item would be most beneficial to Rajid in 2014?

Ainterest on capital

Binterest on drawings

Climit on annual drawings

Dpartnership salaries

✓ Correct answer

A: interest on capital

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Topic: Analysis and interpretation, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, Oct/Nov 2015 Paper 1 Variant 1, question 19.

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