WAEC Accounting 2014 Paper

Concept:In a partnership, first adjust the year's profit for interest on capital and interest on drawings, then divide the remaining profit in the capital ratio.Explanation:Aye's capital is $\text{Le }20,000$ and Bee's capital is $\text{Le }30,000$.So the capital ratio is $20,000 : 30,000 = 2 : 3$.The profit for the year is $\text{Le }12,000$.Interest on capital at $6\%$ gives Aye $6\% \times 20,000 = \text{Le }1,200$ and Bee $6\% \times 30,000 = \text{Le }1,800$.Total interest on capital is $\text{Le }3,000$.Interest on drawings at $10\%$ gives Aye $10\% \times 8,000 = \text{Le }800$ and Bee $10\% \times 2,000 = \text{Le }200$.Total interest on drawings is $\text{Le }1,000$.Divisible profit is $12,000 + 1,000 - 3,000 = \text{Le }10,000$.Aye's share is $\frac{2}{5} \times 10,000 = \text{Le }4,000$.Answer:Aye's share of profit is $\text{Le }4,000$, so the correct option is C.