Caden and Shen had traded as sole traders for many years. On 1 May 2018 they formed a partnership. The following assets and liabilities were recorded in the books of the sole traders. Caden $ Shen $ Non-current assets 25000 40000 Inventory 8000 14000 Trade receivables 5400 2700 Bank 3500 Credit 1500 Debit Trade payables 4900 7100 The partners agreed that the value of Shen's non-current assets was $30000 and the trade receivables $1600. They also agreed that Caden's goodwill was to be valued at $15000. REQUIRED

1. (a)Calculate the capital to be brought into the partnership by each partner. Caden Shen[2]
2. (b)State two possible reasons why the business of Caden has goodwill but the business of Shen does not have goodwill. 1 2[2]
3. (c)State one reason why it is important for partners to prepare a formal partnership agreement.[1]
4. (d)State two differences between a partner's capital account and a partner's current account. 1 2[2]
5. (e)Prepare the capital accounts of the partners at 1 May 2018 showing the removal of the goodwill. Balance the accounts and bring down the balances.[4]
6. (f)Prepare the appropriation account for the year ended 30 April 2019.[7]