Data tableMore infoBefore including the current year's gain and loss, Sandy and Dan had $38,000 and$85,000 bases for their partnership interests, respectively. The partnership has nononrecourse liabilities. Dan has no further obligation to make any additionalinvestment in the partnership.Ordinary loss$150,000Long-term capital gain35,000 Sandy and Dan own 40% and 60%, respectively, of the SD Partnership, which manufactures clocks. The partnership is a limited partnership, and Sandy is the only general partner. She works full-time in thebusiness. Dan essentially is an investor in the firm and works ful-time at another job. Dan has no other income except his salary from his full-time employer. During the current year, the partnership reports thefollowing gain and loss:E (Click the icon to view the gain and loss.)1 (Click the icon to view additional information.)Read the requirementsRequirement a. What gain or loss should each partner report on his or her individual tax return?Begin by determining the amount and character of gain or loss Sandy should report.CharacterAmount- XRequirementsWhat gain or loss should each partner report on his or her individual taxreturn?а.b. If the partnership borrowed an additional $110,000 of recourse liabilities, howwould your answer to Part a change?

Partnership refers to the form of business in which two or more partners are ready to manage and…

Data table More info Before including the current year's gain and loss, Sandy and Dan had $38,000 and $85,000 bases for their partnership interests, respectively. The partnership has no nonrecourse liabilities. Dan has no further obligation to make any additional investment in the partnership. Ordinary loss 150,000 Long-term capital gain 35,000

Data table More info Before including the current year's gain and loss, Sandy and Dan had $38,000 and $85,000 bases for their partnership interests, respectively. The partnership has no nonrecourse liabilities. Dan has no further obligation to make any additional investment in the partnership. Ordinary loss 150,000 Long-term capital gain 35,000

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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The partnership of Hendrick, Mitchum, and Redding has the following account balances: Cash Noncash assets a Maximum amount b Distributed $ 51,000 136,000 This partnership is being liquidated. Hendrick and Mitchum are each entitled to 30 percent of all profits and losses with the remaining 40 percent going to Redding. Hendrick Mitchum Liabilities Hendrick, capital Mitchum, capital Redding, capital a. What is the maximum amount that Redding might have to contribute to this partnership because of the deficit capital balance? b. How should the $10,000 cash that is presently available in excess of liabilities be distributed? c. If the noncash assets are sold for a total of $51,000, what is the minimum amount of cash that Hendrick could receive? (Do not round intermediate calculations.) Redding C Minimum amount $ 41,000 91,000 71,000 (16,000)
Alma, Tina and Carla are partners. They divide profits and losses 30%, 40% and 30%, respectively. On June 30, 2019, they decided to liquidate their partnership because of continuous losses in operation. The following balances of selected accounts were taken from the books of the partnership on this date: Accounts Receivable - Tina Loans Payable - Carla Loans Payable - Alma Alma, Capital Tina, Capital Carla, Capital P24,000 9,600 28,800 118,800 88,800 78,000 On this date, the partnership's assets were P534,400 excluding the receivables from partners and cash of P28,000. The non-cash assets assets were sold at 70% of book value. After the realization, the partnership paid all outside creditors and liquidation expenses of P12,000 and distributed the remaining cash to the partners. 23. How much was cash was distributed to the partners? a. C. b. d. P98,400 P132,000 P178,400 P78,000 000,049 000 214
Franco and Jason share income and losses in a 2:1 (2/3 to Franco and 1/3 to Jason) ratio after allowing for salaries of $18,000 and $37,500, respectively. If the partnership suffers a $15,000 loss, by how much would Jason's capital account increase? a.$26,500 b.$32,500 c.$14,000 d.$37,500
1. In 2020, Joanne invested $90,000 for a 20% interest in a partnership in which she is a material participant. The partnership reported losses of $340,000 in 2020 and $180,000 in 2021. Joanne’s share of the partnership losses was $68,000 in 2020 and $36,000 in 2021. How much of these losses can Joanne deduct on her tax return? $0 in 2020; $0 in 2021. $68,000 in 2020; $22,000 in 2021. $68,000 in 2020; $36,000 in 2021. $68,000 in 2020; $0 in 2021.
Xavier and Yolonda have original investments of $50,000 and $100,000 respectively in a partnership. The articles of partnership include the following provisions regarding the division of net income: interest on original investment at 10%, salary allowances of $27,000 and $18,000 respectively, and the remainder equally. How much of the net income of $40,000 is allocated to Xavier? 21. a. $20,000 b. $22,000 c. $32,000 d. $0 Moderate OBJ: LO: 12-02 DIF: PTS: 1 ANS: B KEY: Bloom's: Application NAT: BUSPROG: Analytic
Holly and Luke formed a partnership, investing $240,000 and $80,000, respectively. Determine their participation in the year's net income of $380,000 under each of the following independent assumptions: No agreement concerning division of net income; Divided in the ratio of original capital investment; Interest at the rate of 15% allowed on original investments and the remainder divided in the ratio of 2:3; Salary allowances of $50,000 and $70,000, respectively, and the balance divided equally; Allowance of interest at the rate of 15% on original investments, salary allowances of $50,000 and $70,000, respectively, and the remainder divided equally.
Beau Dawson and Willow McDonald formed a partnership, investing $75,000 and $225,000, respectively. Determine their participation in the year's net income of $300,000 under each of the following independent assumptions: a. No agreement concerning division of net income.b. Divided in the ratio of original capital investment.c. Interest at the rate of 5% allowed on original investments and the remainder divided in the ratio of 2:3.d. Salary allowances of $34,000 and $46,000, respectively, and the balance divided equally.e. Allowance of interest at the rate of 5% on original investments, salary allowances of $34,000 and $46,000, respectively, and the remainder divided equally. Dawson McDonald a. $ $ b. $ $ c. $ $ d. $ $ e. $ $
How much is the share of Lorna share in the net income? * P89,235.00 P90,382.50 P90,735.00 P91,350.00 answer not given
Nicholas and Sarah began a partnership by investing $52,000 and $78,000. During the first year running, it had net income $180,000 A. allocation based on no agreement B. allocation based on partner initial investment C. allocation based on partnership conditions Nicholas Sarah 1) salary allowance 85000 65000 2) Interest allowance 10%on initial investment 3) split rest of balance equally
Part 1. Gibbs, Hook, and Chan are partners and share income and loss in a 5:1:4 ratio (in percents: Gibbs, 50%; Hook, 10%; and Chan, 40%). The partnership’s capital balances are as follows: Gibbs, $606,000; Hook, $148,000; and Chan, $446,000. Gibbs decides to withdraw from the partnership. Prepare journal entries to record Gibbs’s April 30 withdrawal under each separate assumption: a. Gibbs sells her interest to Brady for $250,000 after Brady is approved as a partner. b. Gibbs gives her interest to a daughter-in-law, Kannon, and Kannon is approved as a partner. c. Gibbs is paid $606,000 in partnership cash for her equity. d. Gibbs is paid $350,000 in partnership cash for her equity. e. Gibbs is paid $200,000 in partnership cash plus manufacturing equipment recorded on the partnership books at $538,000 less its accumulated depreciation of $336,000. Part 2. Assume that Gibbs does not retire from the partnership described in part 1. Instead, Chip is admitted to the partnership on April 30…
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 isa. P 560,000 c. P1,160,000b. P1,000,000 d. P1,360,000