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7. A and B's partnership agreement states the following: A and B are to maintain average capital balances of P200,000 and P300,000, respectively. A 12% interest is to be computed on any excess or deficiency. Balance is shared equally. The partnership earned profit of P120,000 for the nine months ended Dec. 31, 20x1. The average capital balances of the partners during the period were P240,000 for A and P220,000 for B. Requirement: Provide the entry to close the income summary account to the partners' capital accounts.

7. A and B's partnership agreement states the following: A and B are to maintain average capital balances of P200,000 and P300,000, respectively. A 12% interest is to be computed on any excess or deficiency. Balance is shared equally. The partnership earned profit of P120,000 for the nine months ended Dec. 31, 20x1. The average capital balances of the partners during the period were P240,000 for A and P220,000 for B. Requirement: Provide the entry to close the income summary account to the partners' capital accounts.

FINANCIAL ACCOUNTING
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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ce 7. A and B's partnership agreement states the following: 00 on A and B are to maintain average capital balances of P200,000 and P300,000, respectively. A 12% interest is to be computed on any excess or deficiency. Balance is shared equally. in The partnership earned profit of P120,000 for the nine months ended Dec. 31, 20x1. The average capital balances of the partners during the period were P240,000 for A and P220,000 for B. Requirement: Provide the entry to close the income summary account to the partners' capital accounts.
Transcribed Image Text:ce 7. A and B's partnership agreement states the following: 00 on A and B are to maintain average capital balances of P200,000 and P300,000, respectively. A 12% interest is to be computed on any excess or deficiency. Balance is shared equally. in The partnership earned profit of P120,000 for the nine months ended Dec. 31, 20x1. The average capital balances of the partners during the period were P240,000 for A and P220,000 for B. Requirement: Provide the entry to close the income summary account to the partners' capital accounts.
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