Maraid Wendy and Diane have been in partnership for a

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Maraid, Wendy and Diane have been in partnership for a number of years sharing profits , and ,
respectively. They decide to form a limited company on 1 January 20X2, called McKee Ltd, to
carry on the business. The statement of financial position of the partnership on 31 December
20X1 is as follows:Additional informationThe updated statement of financial position information
at 31 December 20X1 is as follows:1. The land is valued at £210,000 on the 31 December
20X1.2. A machine that was purchased for £10,000 on 1 January 20W9 is now considered to be
worthless. Machines are depreciated using the sum of digits method over a period of four years.
On 1 January 20X2 the partners considered that this machine would have a residual value of
£2,000. (The figures in the statement of financial position above have been adjusted for 20X1's
depreciation charge.) 3. The financial statements for the period ended 31 December had
omitted the accountancy fee for that period of £3,000.4. During a review of the inventory on 31
December 20X1, items valued in the books at £9,000 were considered to be worth £1,000.5.
The partners received information that one of their customers, 'Seamus', is declared bankrupt.
On investigation, it is estimated that Seamus will only be able to pay 20p for each £1 he owes.
Seamus owes the partnership £50,000.6. A full year's interest is still outstanding and has not yet
been accrued in the above draft figures.RequiredProvide the relevant entries required for
amending the statement of financial position to take account of the new up-to-date information
and prepare the new updated statement of financial position.View Solution:
Maraid Wendy and Diane have been in partnership for a

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