A partnership began its first year of operations with the following capital balances: Young, Capital: Php143,000 Eaton, Capital: Php104,000 Thurman, Capital: Php143,000 The Articles of Partnership
Partnership Accounting
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings, admission of a new partner, etc.
Partner Admission and Withdrawal
A partnership is a kind of arrangement between two or more people whereby they agree to manage the business operations and share its profits and losses in an agreed ratio between them. The agreement that is drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, drawings of a partner, etc.
A
Young, Capital: Php143,000
Eaton, Capital: Php104,000
Thurman, Capital: Php143,000
The Articles of Partnership stipulated that
- Young was to be awarded an annual salary of Php26,000 and Php13,000 salary was to be awarded to Thurman.
- Each partner was to be attributed with interest equal to 10% of the capital balance as of the first day of the year.
- The remainder was to be assigned on a 5:2:3 basis to Young, Eaton, and Thurman, respectively.
- Each partner withdrew Php13,000 per year.
Assume that the net loss for the first year of operations was Php26,000 with net income of Php52,000 in the second year.
What was Thurman's total share of net income for the second year?
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