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$($Subjective$)$

$($Profit And Loss & Appropriation Accounts, Balance Sheet.$)$

Lawyers Lee, Tan and Pang were partners sharing profits and losses in the ratio of $3$:$2$:$1.$ The

following Trial Balance was prepared at the end of $1997$ :

Fixed Capitals $(1$ January $1997)$

Lee

Tan

Pang

Current Accounts

Lee

Tan

Pang

Fixed Assets, Cost

Accumulated Depreciation On Fixed Assets as at $31$ December $1997$

Fees For Services Rendered

Expenses Owing

Operating Expenses for the year, excluding Depreciation

Depreciation On Fixed Assets

Stock For Stationery, $31$ December $1997$

Fees Owing From Clients

Goodwill

Cash At Bank

$18,000$

$15,000$

$12,000$

Creditors

$1,800$

$2,000$

Drawings

Lee

Tan

$10,700$

$2,700$

$1,275$

$4,280$

$14,000$

$2,980$

Pang

Under the partnership agreement, $8\%$ interest on Fixed Capital balance was allowed for each

year.

As from $1$ January $1998,$ Lee intended to play a less active part in the business and from that

date profits and losses would be shared in the ratio of $1$:$2$:$1.$ Goodwill was now valued at

RM $20,000.$

You are required to prepare the partnership's:

$(1)$ Profit And Loss Account, including Appropriation Account, for the year ended $31$

December $1997$;

$(2)$ Balance Sheet as at $1$ January $1998.$

$[$Note: Effecting any adjustment through the columnar Partners$$ Current Account.$]$

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