A, B, and C are partners in an accounting firm. Their capita account balances at the year-end were A P120,000; B P140,000; C P80,000. They share profits and losses on a 3:3:4 ratio, after the following special terms: • Interest of 10% shall be paid on that portion of a partner's capital in excess of P100,000. • Quarterly salaries of P5,000, P5,000 and P6,000 shall be paid to partners A, B, and C, respectively. • Partner C is to receive a bonus of 10% of net income after salaries, interest and bonus. Assuming a net income of P60,000 for the year, the total profit share of partner C was:
A, B, and C are partners in an accounting firm. Their capita account balances at the year-end were A P120,000; B P140,000; C P80,000. They share profits and losses on a 3:3:4 ratio, after the following special terms: • Interest of 10% shall be paid on that portion of a partner's capital in excess of P100,000. • Quarterly salaries of P5,000, P5,000 and P6,000 shall be paid to partners A, B, and C, respectively. • Partner C is to receive a bonus of 10% of net income after salaries, interest and bonus. Assuming a net income of P60,000 for the year, the total profit share of partner C was:
Financial Accounting
14th Edition
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Carl Warren, Jim Reeve, Jonathan Duchac
Chapter12: Accounting For Partnerships And Limited Liability Companies
Section: Chapter Questions
Problem 9E
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Question
![A, B, and C are partners in an accounting firm. Their capital
account balances at the year-end were A P120,000; B
P140,000; C P80,000. They share profits and losses on a
3:3:4 ratio, after the following special terms:
o Interest of 10% shall be paid on that portion of a
partner's capital in excess of P100,000.
• Quarterly salaries of P5,000, P5,000 and P6,000 shall
be paid to partners A, B, and C, respectively.
• Partner C is to receive a bonus of 10% of net income
after salaries, interest and bonus.
Assuming a net income of P60,000 for the year, the total
profit share of partner C was:](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6593e090-7919-4ca5-9b4f-b85c7db31238%2Fd57446cd-870a-4b8f-a381-f4e7ecaa10f7%2Fuuh9t_processed.png&w=3840&q=75)
Transcribed Image Text:A, B, and C are partners in an accounting firm. Their capital
account balances at the year-end were A P120,000; B
P140,000; C P80,000. They share profits and losses on a
3:3:4 ratio, after the following special terms:
o Interest of 10% shall be paid on that portion of a
partner's capital in excess of P100,000.
• Quarterly salaries of P5,000, P5,000 and P6,000 shall
be paid to partners A, B, and C, respectively.
• Partner C is to receive a bonus of 10% of net income
after salaries, interest and bonus.
Assuming a net income of P60,000 for the year, the total
profit share of partner C was:
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