WAEC Past Questions and Answers - Page 1073

\(\begin{array}{c|c} \text{Cost of motor vehicle - 1\1\12} & ₦ 85,000 \\ \text{Residual value} & ₦5,000 \\ \text{Estimated useful lifespan 10 years} & \end{array}\).
The business make use of the straight line method for providing depreciation, the annual depreciation is

\(\begin{array}{c|c} Capital & Le\\ Aye & 20,000\\ Bee & 30,000\\ Drawings & \\ Aye & 8,000 \\ Bee & 2,000 \\ \text{Profit for the year} & 2,000\\ \{text{Interest on capital-6%} & \\ \text{Interest on drawings - 10%} & \end{array}\)

Profit sharing is in the ratio of capital. Bee's share of profit is

\(\begin{array}{c|c} Capital & Le\\ \hline Aye & 20,000\\ Bee & 30,000\\ Drawings & \\ Aye & 8,000 \\ Bee & 2,000 \\ \text{Profit for the year} & 2,000\\ \text{Interest on capital-6%} & \\ \text{Interest on drawings - 10%} & \end{array}\).
Profit sharing is in the ratio of capital. Aye's share of profit is

\(\begin{array}{c|c} Capital & Le \\ \hline Aye & 20,000\\ Bee & 30,000\\ Drawings & \\ Aye & 8,000 \\ Bee & 2,000 \\ \text{Profit for the year} & 2,000\\ \text{Interest on capital-6%} & \\ \text{Interest on drawings - 10%} & \end{array}\)

Profit sharing is in the ratio of capital. The divisible profit is

\(\begin{array}{c|c} \text{Branch stock account (at selling price)} & D346,000 - debit \\ \text{Branch mark-up account} & D62,000 - credit \end{array}\)

The concept applied in calculating the stock figure to be included in the balance sheet at the year end is