E12-5 Aikman (beginning capital, $60,000) and Rory (beginning capital $90,000) are part- P ners. During 2012, the partnership earned net income of $70,000, and Aikman made drawings of ra $18,000 while Rory made drawings of $24,000. Instructions (a) Assume the partnership income-sharing agreement calls for income to be divided 45% to Aikman and 55% to Rory. Prepare the journal entry to record the allocation of net income. (b) Assume the partnership income-sharing agreement calls for income to be divided with a sal- ary of $30,000 to Aikman and $25,000 to Rory, with the remainder divided 45% to Aikman and 55% to Rory. Prepare the journal entry to record the allocation of net income. (c) Assume the partnership income-sharing agreement calls for income to be divided with a salary of $40,000 to Aikman and $35,000 to Rory, interest of 10% on beginning capital, and the remainder divided 50%-50%. Prepare the journal entry to record the allocation of net income. (d) Compute the partners' ending capital balances under the assumption in part (c). E12-6 For Starrite Co., beginning capital balances on January 1,2012, are Donna Noble $20,000 and Amy Bond $18,000. During the year, drawings were Noble $8,000 and Bond $5,000. Net in- come was $30,000, and the partners share income equally. Instructions (a) Prepare the partners' capital statement for the year. (h) Prepare the owners' equity section of the balance sheet at December 31, 2012.
E12-5 Aikman (beginning capital, $60,000) and Rory (beginning capital $90,000) are part- P ners. During 2012, the partnership earned net income of $70,000, and Aikman made drawings of ra $18,000 while Rory made drawings of $24,000. Instructions (a) Assume the partnership income-sharing agreement calls for income to be divided 45% to Aikman and 55% to Rory. Prepare the journal entry to record the allocation of net income. (b) Assume the partnership income-sharing agreement calls for income to be divided with a sal- ary of $30,000 to Aikman and $25,000 to Rory, with the remainder divided 45% to Aikman and 55% to Rory. Prepare the journal entry to record the allocation of net income. (c) Assume the partnership income-sharing agreement calls for income to be divided with a salary of $40,000 to Aikman and $35,000 to Rory, interest of 10% on beginning capital, and the remainder divided 50%-50%. Prepare the journal entry to record the allocation of net income. (d) Compute the partners' ending capital balances under the assumption in part (c). E12-6 For Starrite Co., beginning capital balances on January 1,2012, are Donna Noble $20,000 and Amy Bond $18,000. During the year, drawings were Noble $8,000 and Bond $5,000. Net in- come was $30,000, and the partners share income equally. Instructions (a) Prepare the partners' capital statement for the year. (h) Prepare the owners' equity section of the balance sheet at December 31, 2012.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:E12-5 Aikman (beginning capital, 560,000) and Rory (beginning capital $90,000) are part- Prep
ners. During 2012, the partnership earned net income of $70,000, and Aikman made drawings of recom
$18,000 while Rory made drawings of $24,000.
(50
Instructions
(a) Assume the partnership income-sharing agreement calls for income to be divided 45% to
Aikman and 55% to Rory. Prepare the journal entry to record the allocation of net income.
(b) Assume the partnership income-sharing agreement calls for income to be divided with a sal-
ary of $30,000 to Aikman and $25,000 to Rory, with the remainder divided 45% to Aikman
and 55% to Rory. Prepare the journal entry to record the allocation of net income.
(c) Assume the partnership income-sharing agreement calls for income to be divided with a
salary of $40,000 to Aikman and $35,000 to Rory, interest of 10% on beginning capital, and
the remainder divided 50%-50%. Prepare the journal entry to record the allocation of net
income.
(d) Compute the partners' ending capital balances under the assumplion in part (c).
E12-6 For Starrite Co, beginning capital balances on January 1,2012, are Donna Noble $20,000
and Amy Bond $18,000. During the year, drawings were Noble $8,000 and Bond $5,000. Net in-
come was $30,000, and the partners share income equally.
Instructions
(a) Prepare the partners' capital statement for the year.
(b) Prepare the owners' equity section of the balance sheet at December 31, 2012.
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