30. The Grey and Redd Partnership was formed on January 2, 2021. Under the partnership agreement, each partner has an equal initial capital balance. Partnership net income or loss is allocated 60% to Grey and 40% to Redd. To form the Partnership, Grey originally contributed assets costing P30,000 with fair value of P60,000 on January 2, 2021, and Redd contributed P20,000 cash. Drawings by the parties during 2021 totaled P3,000 by Grey and P9,000 by Redd. The Partnership net income in 2021 was P25,000. What is the amount of bonus? * a. P20,000 bonus to Grey b. P20,000 bonus to Redd c. P40,000 bonus to Grey Ⓒd. P40,000 bonus to Redd

30. The Grey and Redd Partnership was formed on January 2, 2021. Under the partnership agreement, each partner has an equal initial capital balance. Partnership net income or loss is allocated 60% to Grey and 40% to Redd. To form the Partnership, Grey originally contributed assets costing P30,000 with fair value of P60,000 on January 2, 2021, and Redd contributed P20,000 cash. Drawings by the parties during 2021 totaled P3,000 by Grey and P9,000 by Redd. The Partnership net income in 2021 was P25,000. What is the amount of bonus? * a. P20,000 bonus to Grey b. P20,000 bonus to Redd c. P40,000 bonus to Grey Ⓒd. P40,000 bonus to Redd

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Part II: Problems 1. On January 1, 2021, Kaye, Erika and April formed a partnership with original capital contribution ratio or 4:5:1 for total agreed capitalization of P5,000,000. The profit or loss ratio agreement provides that profits shall be distributed in the ratio of 3:2:5 while losses shall be distributed in the ratio of 6:1:3. During 2021, the partnership reported net income of P2,000,000 with Kaye and Erika withdrawing P500,000 and P300,000, respectively. During 2022, the partnership reported net loss of P1,000,000 with Erika and April withdrawing P200,000 and P400,000 respectively. What is the adjusted capital balances of each partner on December 31, 2022?
Ehrlich (beginning capital, $110,000) and Haar (beginning capital $85,000) are partners. During 2022 the partnership earned net income of $60,000. Ehrlich made drawings of $25,000 while Haar made drawings of $10,000. Instructions Assume the partnership income-sharing agreement calls for income to be divided with a salary of $22,000 to Ehrlich and $25,000 to Haar, interest of 10% on beginning capital, and the remainder divided 70%-30%. Prepare a schedule of the income allocation to each partner. Prepare the journal entry to record the allocation of net income. Compute Ehrlich's ending capital balance
Coburn (beginning capital, $60,000) and Webb (beginning capital $90,000) are partners. During 2020, the partnership earned net income of $80,000, and Coburn made drawings of $18,000 while Webb made drawings of $24,000. (Assume the partnership income-sharing agreement calls for income to be divided 45% to Coburn and 55% to Webb. Prepare the journal entry to record the allocation of net income) What are the account titles and explanations? What is debit? What is credit?
Energetic and Faithful decided to form a partnership on June 1, 2021 by investing P100,000 and P150,000 respectively. They agreed that profits are to be divided as follows: Partners are to receive a 10% interest on beginning capital. Each partner is to receive an annual salary of P24,000. Energetic, the managing partner, is to receive a bonus equivalent to 10% of the net income after interest, salaries and bonus. The remaining profit is to be divided equally. Energetic invested P50,000 on August 1 and withdrew cash amounting to P10,000 on December 1. Faithful invested P15,000 on September 1 and withdrew cash amounting to 5,000 in November 1. During the year, the partnership had a net income of P80,000. How much is the ending capital of Energetic and Faithful?
Net income for AB partnership for 2021 was $125,000. A and B have agreed to distribute partnership net income according to the following plan as shown in the image. Additional Information for 2021 follows:  A began the year with a capital balance of $75,000  B began the year with a capital balance of $100,000  On March 1, A invested an additional $25,000 into the partnership  On October 1, B invested an additional $20,000 into the partnership  Throughout 2021, each partner withdrew $200 per week in anticipation of partnership net income. The partners agreed that these withdrawals are not to be included in the computation of average capital balances for purposes of income distributions. A. Allocate the income to partners A and B B. Compute for the ending capital balances of the partners.
Assuming the partnership earned P200,000 profit in 2020. Since they are both active in partnership's affair, each one will receive a 50,000 salaryallowance per year determine the new partners' capital after the distribution of profit and loss.
The accounts of the partnership of A, B and C at the end of its fiscal year on October 31, 2018 are as follows: P 78,750 Liabilities Loan from C Cash P262,500 Other Non-Cash Assets 682,500 26,250 52,500 Loan to B A, Capital (30%) B, Capital (50%) C, Capital (20%) 236,250 157,500 78,750 If P90,000 is available for distribution to partners after all non-partner liabilities are paid, how much should A receive? _8. D.
The Prince-Robbins partnership has the following capital account balances on January 1, 2024: Prince, Capital Robbins, Capital $ 150,000 110,000 Prince is allocated 60 percent of all profits and losses with the remaining 40 percent assigned to Robbins after interest of 10 percent is given to each partner based on beginning capital balances. On January 2, 2024, Jeffrey invests $76,000 cash for a 20 percent interest in the partnership. This transaction is recorded by the goodwill method. After this transaction, 10 percent interest is still to go to each partner. Profits and losses will then be split as follows: Prince (50 percent), Robbins (30 percent), and Jeffrey (20 percent). In 2024, the partnership reports a net income of $36,000. Required: 1. Prepare the journal entry to record Jeffrey's entrance into the partnership on January 2, 2024. 2. Prepare a schedule showing how the 2024 net income allocation to the partners should be determined.
A and B formed a Partnership on January 1, 2020. Partner A’s contributed capital amounted to P40,000, while partner B’s contributed capital amounted to P20,000. The Partnership agreement provides for the following: Capital accounts are to be credited annually with interest at 5% of the beginning capital. Partner B is to be paid salary of P6,000 quarterly. Partner B is to receive a bonus of 10% based on the net income The Partnership's income statement for the year ended is as follows: Revenues, P105,000Expenses (including salary, interest, and bonus), 30,000Net income, 75,000 What is partner's B 2020 bonus? Group of answer choices 9,273 7,500 9,333 11,333
Xavier, Young, and Zane operate a partnership with a complex profit and loss sharing agreement. The average capital balance for each partner on December 31, 2021 is P300,000 for Xavier, P250,000 for Young, and P325,000 for Zane. An 8% interest allocation is provided to each partner based on the average capital balance on December 31, 2021. Xavier and Young receive salary allocations of P10,000 and P15,000, respectively. If partnership net income is above P25,000, after the salary allocations are considered (but before the interest allocations are considered), Zane will receive a bonus of 10% of the original amount of net income. All residual income is allocated in the ratios of 23.5 to Xavier, Young, and Zane, respectively. If the the partnership net income for 2021 is P250,000, the total share of Xavier, Young and Zane, respectively are:
Coburn (beginning capital, $56,000) and Webb (beginning capital $92,000) are partners. During 2022, the partnership earned net income of $69,000, and Coburn made drawings of $17,000 while Webb made drawings of $26,000. Assume the partnership income-sharing agreement calls for income to be divided with a salary of $37,000 to Coburn and $32,000 to Webb, interest of 12% on beginning capital, and the remainder divided 50%–50%. Prepare the journal entry to record the allocation of net income.
33.X, Y, and Z formed a partnership on Jnauary 1, 2021, and contributed P150,000; P200,000; P300,000, respectively. Their articles of co-partnership provide that the operating income be shared among partners as foliows: as salary, P24,000 for X; P18,000 for Y; and P12,000 for Z; interest of 12% on the average capital during 2021 of the three partners; and the remainder in the ratio of 4:2:4, respectively. The operating income for the year-end December 31, 2021 amounted to P200,000. X contributed additional capital of P30,000 on July 1, and made a drawing of P10,000 on October 1; Y contributed additional capital of P20,000 on August 1, and made a drawing of P10,000 on October 1; and Z made a drawing of P30,000 on November 1, 2021. How much is the shared profit of partner X?