B, G, and C put up a partnership on April 1, 2017. The following capital balances were taken from the books on December 31, 2017, beforeclosing net income:B, CapitalP84,000G, Capital114,000C, Capital92,000During the year, B permanently withdrew P10,000 cash while C invested a property with a fair value of P22,000.The partners agreed to distribute profits for the first year as follows:Annual salary of P30,000 to G and P25,000 to C.Allow a 5% interest to each partner on their capital at the inception of the partnership.Allow a 20% bonus to B based on net income after salaries, interests, and bonus.Any remaining undistributed profit or loss will be distributed in the following manner:In the ratio 2:3:5, if under-allocatedEqually, if over-allocatedCase 1: The net income of the partnership is P100,000 during the year 2017.How much is the bonus given to B?O 7,3750 7.9790 7.475O 8.054

B, Capital G, Capital C, Capital Total Net Income (Loss) P1,00,000 Salary allowanceD…

Answered: B, G, and C put up a partnership on…

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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Charles, Ward, and Nelson formed a partnership on January 1, 2016, with investments of $100,000, $150,000, and $200,000, respectively. For division of income, they agreed to (1) interest of 10% of the beginning capital balance each year, (2) annual compensation of $10,000 to Ward, and (3) sharing the remainder of the income or loss in a ratio of 20% for Charles, and 40% each for Ward and Nelson. Net income was $150,000 in 2016 and $180,000 in 2017. Each partner withdrew $12,000 annually for personal use every during 2016 and 2017.What was Nelson's capital balance at the end of 2016?
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The capital accounts of Scott and Tucker at the end of the fiscal year 2019 are as follows: Scott, Capital January 1 Balance P210,000 Мay 1 Investment 90,000 October 1 Withdrawal Р60,000 Tucker, Capital January 1 Balance P150,000 April 1 Withdrawal P30,000 The partnership profit for the year ended December 31, 2019 was P300,000. Instruction: Prepare schedule of profit allocation and journal entries to record transfer to profit to the capital accounts under each of the following independent assumptions: 1. Profit is divided 60% to Scott and 40% to Tucker. 2. Profit is divided into ratio of capital balances at the beginning of the period. 3. Profit is divided in the ratio of average capital balance. Interest of 8% is allowed on the average capital and the balance of profit is divided equally. 4. Salaries of P60,000 and P48,000 are allowed to Scott and Tucker, respectively, and the balance of the profit is divided in the ratio of capital balances at the end of the period. 5. 6. Scott is…
A, B and C were partners sharing profits and losses equally. Their respective capitals balances on 31.3.2015 were $ 1,20,000, $ 99,000 and $ 1,62,000 respectively. After closing the accounts for the year 31st March, 2015 it was discovered that during the year 2014-15, interest on capitals at the rate of 5% p.a. was provided to all the partners, however, there was no such clause in the partnership deed. Profits for the year ended 31st March, 2015 amounting to $ 45,000 was also credited to the partners capital, in arriving at the closing capitals of the partners. You are required to pass an adjusting entry to rectify this error.
Kind and Lucky formed a partnership by contributing cash amounting to P240,000 and P480,000 respectively on January 1, 2021. They agreed to share profits and losses in the ratio of 3:2. During the first year of operation, both Kind and Lucky made a withdrawal of P50,000 and P80,000 respectively. They also reported a net profit of P175,000. At the start of the following year, they agreed to admit Mature into the partnership by purchasing one-fourth interest from the partners for P300,000. How much is the new P&L ratio of Lucky after admission?
Kind and Lucky formed a partnership by contributing cash amounting to P240,000 and P480,000 respectively on January 1, 2021. They agreed to share profits and losses in the ratio of 3:2. During the first year of operation, both Kind and Lucky made a withdrawal of P50,000 and P80,000 respectively. They also reported a net profit of P175,000. At the start of the following year, they agreed to admit Mature into the partnership by investing P300,000 for a one-fourth interest. Under asset revaluation method, how much is the capital balance of Lucky after admission?
V Singh and G Randle have a partnership agreement with the following provisions for sharing profit or loss: 1. A salary allowance of $30,900 to Singh and $40,600 to Randle 2. An interest allowance of 5% on capital balances at the beginning of the year 3. The remainder to be divided between Singh and Randle on a 2:3 basis The capital balances on January 1, 2014, for Singh and Randle were $83,000 and $104,000, respectively. For the year ended December 31, 2014, the Singh Randle Partnership had a net loss of $35,000; V. Singh drawings of $23,900; and G. Randle drawings of $30,700. Required: a. Show how the profit or loss will be allocated to the two partners. b. Prepare closing entries for sales of $337,000; cost of goods sold of $246,000; operating expenses of $126,000, net loss of $35,000; V. Singh drawings of $23,900; and G. Randle drawings of $30,700
Elisa Diaz and Ma. Concepcion Manalo formed a partnership, investing P330,000 and P110,000, respectively. Determine the partners' participation in the 2019 profit of P420,000 under each of the following independent assumptions: a.) No agreement concerning division of profit. b.) Divided in the ratio of original capital investment. c.) Interest at the rate of 8% allowed on original investments and the remainder divided in the ratio of 2:3. d.) Salary allowances of P50,000 and P70,000, respectively, and the balance to be divided equally. e.) Allowance of interest at the rate of 8% on original investments, salary allowances of P50,000 and P70,000, respectively, and the remainder to be divided equally.
A and B formed a Partnership on January 1, 2020. A contributed capital of P50,000, while B contributed capital of P30,000. The Partnership agreement provides for the following: o Capital accounts are to be credited annually with interest at 5% of the beginning capital. o Partner B is to be paid salary of P2,000 a month. o 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 P101,000 30,000 71,000 Expenses (including salary, interest, and bonus) Net income Determine the amount of bonus.
On September 13, 2016, AA and BB decided to combine their assets and form a partnership. The partnership is to take over the business assets and assume the business liabilities; and capitals are to be based on net assets and transferred after the following adjustments. 1. BB's inventory is to be valued at P140,000. 2. A 5% allowance for uncollectible accounts is to be established on the accounts receivable of each party. 3. Accrued liabilities of P8,000 are to be recognized in AA's books. The statements of financial position on September 13 before adjustments are given below.
Diala and Tamer, partners in DT Company, have capital balances on January 1, 2016 of $72,000 and $48,000 respectively. The net income for the year is $86,000. The partnership income-sharing agreement indicates: 1. Annual Salaries of $24,000 for Diala and $16,000 for Tamer. 2. Interest of 10% on beginning capital balances for all partners. 3. Remaining income or loss to be shared in accordance with the ratio of the partners' original capital investments. Diala ratio= 72,000/(72,000+48,000)=0.6=60% Tamer=48,000/(72,000+48,000)=0.4=40% Instructions: (a) Prepare a schedule showing the distribution of net income for the partnership. (b)Prepare the journal entry to record the division of net income.
Curtis and Sillett are in partnership, sharing profits in the ratio 3:2 and compiling their accounts to 30 June each year. On 1 January 2015, Mcallister joined the partnership, and from that the date the profit sharing ratio became Curtis 50%, Sillett 25% and Mcallister 25%, after providing for salaries for Sillet and Mcallister of $20,000 and $12,000 pa respectively. The partnership profit for the year ended 30 June 2015 was $480,000, accruing evenly over the year. What are the artners' total profit shares for the year ended June 2015? А. Curtis-256,000 , Sillet - 162,000 , Mcallister - 62,000 В. Curtis -264,000 , Sillet - 156,000 , Mcallister -60,000 С. Curtis - 264,000 , Sillet - 166,000 , Mcallister - 66,000 D. Curtis - 248,000 , Sillet - 168,000 , Mcallister - 64,000

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