Ummoja Co. Ltd has an Authorized Share Capital composed of 500000 Ordinary Shares of sh5 each and…
Ummoja Co. Ltd has an Authorized Share Capital composed of 500000 Ordinary Shares of sh5 each and 10% 100000 Preference Shares of sh 20 each, issued and fully paid up capital
| Bonds | 200000 | |||
| General reserve | 50000 | |||
| Retained earnings | 100000 | |||
| Net profit for year 2012 | 800000 | |||
| Fixed assets | 2500000 | |||
| Current assets | 1300000 | |||
| Current liabilitiesAdditional information
Ø Sh. 50000 to be transferred to general reserve Ø Payment of preference dividend |
150000 | |||
| ØPayment of an ordinary dividend of 20% |
Required
i) Appropriation account for year 2012
ii) Balance sheet as at 31st Dec 2012 (10 mrks)
4b. i)Explain the circumstances that may prompt a partnership to recognize goodwill.
ii)What is the difference between capital reserve and revenue reserves (10 mrks)
