Ben and Carrie enter into a partnership agreement whereby they undertake to share profits according to the following rules: (a) Ben and Carrie will receive a salary of $1,500 and $13,500 respectively (b) The next allocation is based on 20% of the parner's capital balances ('c) Any remaining profit or loss is to be borne completely by Carrie The partnership's Net Income for the first year is $40,000. Ben's capital balance is $90,000 and Carrie's capital balance is $10,000 as at the end of the year. Calculate the share of profit/loss to be borne by Carrie. (it's asking for the total share of the Net Income Carrie will obtain) A $ 4,000.00 B $ 17,500.00 C $ 19,500.00 D $ 20,500.00
Ben and Carrie enter into a partnership agreement whereby they undertake to share profits according to the following rules: (a) Ben and Carrie will receive a salary of $1,500 and $13,500 respectively (b) The next allocation is based on 20% of the parner's capital balances ('c) Any remaining profit or loss is to be borne completely by Carrie The partnership's Net Income for the first year is $40,000. Ben's capital balance is $90,000 and Carrie's capital balance is $10,000 as at the end of the year. Calculate the share of profit/loss to be borne by Carrie. (it's asking for the total share of the Net Income Carrie will obtain) A $ 4,000.00 B $ 17,500.00 C $ 19,500.00 D $ 20,500.00
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Ben and Carrie enter into a
(a) Ben and Carrie will receive a salary of $1,500 and $13,500 respectively
(b) The next allocation is based on 20% of the parner's capital balances
('c) Any remaining profit or loss is to be borne completely by Carrie
The partnership's Net Income for the first year is $40,000. Ben's capital balance is $90,000 and Carrie's capital balance is $10,000 as at the end of the year. Calculate the share of profit/loss to be borne by Carrie. (it's asking for the total share of the Net Income Carrie will obtain)
| A | $ 4,000.00 |
| B | $ 17,500.00 |
| C | $ 19,500.00 |
| D | $ 20,500.00 |
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education