(Guarantee by old partners in specific ratio). Antonio and Chekov were partners sharing profits in the ratio of 3:2. They admit Hugo as a partner. Hugo was to receive a salary of $45 per annum, plus a commission of 10% on the profits after charging such salary and commission or 1/5th of the profits of the firm, whichever is larger. Any excess of latter (i.e. profits) over the former (i.e. salary & commission) is to be borne by Antonio and Chekov the ratio of 2:1. Prepare the Profit & Loss Appropriation Account, if profit for the year after charging John Salary and commission is $450.

(Guarantee by old partners in specific ratio). Antonio and Chekov were partners sharing profits in the ratio of 3:2. They admit Hugo as a partner. Hugo was to receive a salary of $45 per annum, plus a commission of 10% on the profits after charging such salary and commission or 1/5th of the profits of the firm, whichever is larger. Any excess of latter (i.e. profits) over the former (i.e. salary & commission) is to be borne by Antonio and Chekov the ratio of 2:1. Prepare the Profit & Loss Appropriation Account, if profit for the year after charging John Salary and commission is $450.

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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