Answered: Bucao, Basco, and Blanco share profits…

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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Question

Bucao, Basco, and Blanco share profits and losses in the ratio of 2:3:5, respectively. Their
partnership realized a profit of P1,800,000 during the year. Bucao, with a beginning capital
balance of P1,000,000 withdrew P200,000 during the year. Bucao’s ending capital balance
is
a. P 560,000 c. P1,160,000
b. P1,000,000 d. P1,360,000

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement 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, and drawings of a partner.

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