Distribution of Profits or Losses Based on Partners' Agreement Pasia, Te, and Ocenar each receive a P70,000 salary, as well as 15% interest on their respective average investments of P200,000, P100,000, and P400,000. If they share remaining profits and losses in a 4:3:2 ratio, respectively, by how much would Ocenar account increase or decrease (indicate a decrease by placing parentheses), assuming: (a) profit of P405,000, (b) profit of P270,000, and (c) loss of P315,000. In addition, calculate (d) Ocenar share of a P350,000 profits if profit and loss distributions were based instead solely on the ratio of average capital investments.
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.
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